Critter-3.
Well there is a confusion here. What you are saying is correct for single member LLC but single member LLC with S election for taxes is different animal.
With S corp you can pay yourself wages, 401K contribution to max ($19500) and 25% profit sharing until $154000 (154000*..25= $38500)
Payroll taxes on SS (6.2 +6.2) and medical care (2.9% total) will be offset by saving of deduction of 401 k benefits and + tax deferred growth of those assets. Assets in 401K are better protected in law suits as well (I think). On the top of that you can deduct all other kind of expenses, Health, Dental, continous education, subscription, office, equipment etc.
Medicare taxes are tricky. Once your income crosses 200/250 single/married, all of your income from 0 till infiniti is subject to 2.9% tax.
In trading/short term most of income is ordinary income any way. You will never qualify for TTS, if there is long term income.
Q. Obamacare Tax:
Medicare Tax is on earned income, income from work and investment income is NOT subject to medicare Tax.
Is this Obamacare tax on income "over" 200k/250K single/married or once your total income (income from all sources) hit that threshold then all of your income (0 till infiniti) wages and investment income become subject to 3.8 Tax?
Q. What are exclusions to Obamacare Tax? Muni interest? All of it or from your state muni only?
Does distributions from K1, subject to Obama care? Remember these distributions are NOT reported along with dividends as they reduce cost basis of original investments?
