Prop Firm Traders
Tax Help for Prop Firm & Funded Account Traders
Most U.S. prop firms send a 1099-NEC, but the form alone doesn't settle how your payouts are taxed. We start with your trader agreements and build your return around the actual arrangement.
Start Basic IntakeHow it's generally taxed
Contractor payouts
Under a typical independent-contractor agreement, payouts are generally business income on Schedule C and subject to self-employment tax on Schedule SE.
Other arrangements
Employee (W-2) arrangements, profit-sharing through an entity, or trading your own capital are taxed differently. We confirm which applies to each firm.
Foreign firms
Firms like FTMO usually issue no U.S. form. The income is still reportable, converted to U.S. dollars.
General information only. Treatment depends on your facts and agreements.
What we handle
- Review of each firm's trader agreement
- Multi-firm payout reconciliation
- Evaluation, reset and subscription fee deductions
- Foreign prop firm income reporting
- Quarterly estimated tax calculations
- Entity analysis only when the numbers support it
Forms involved
- Form 1099-NEC
- Schedule C
- Schedule SE
- Form 1040-ES
Common mistakes
- Assuming every firm's payouts are taxed the same way
- Leaving out income from firms that send no 1099
- Missing quarterly payments because nothing is withheld
Where most prop firm traders start
Many start with our Essential plan. We'll confirm the right fit after your intake.
Compare plansGuides for prop firm traders
Prop Firms
How to File Prop Firm Taxes: A Step-by-Step Guide for Funded Traders
Prop Firms
Prop Firm Payouts: 1099-NEC vs Capital Gains—What's the Difference?
Prop Firms
Are Prop Firm Evaluation Fees Tax Deductible? (Yes—Here's How)
Compliance
Estimated Tax Payments for Traders: Quarterly Filing and Safe Harbor Rules