Getting Your Own Trading LLC
- Apply for an EIN Number
- Get a registered agent
- Apply for LLC
- Set up business bank account
- Set up payroll software
Apply For An EIN Number
What is an EIN?
Employer identification numbers (EINs) separate a business’s identity from its owner’s identity. The IRS uses EINs to identify your business in tax documents. It’s like a Social Security number (SSN) for your business
Apply for an EIN here : https://www.irs.gov/businesses/small-businesses-self-employed/apply-for-an-employer-identification-number-ein-online
Get a Registered Agent
A registered agent is an individual or entity that has been appointed by an LLC or Corporation to receive service of process, government correspondence, and compliance documents on behalf of the business.
Most states require you to designate a registered agent for your LLC, partnership, or corporation when forming your business. After choosing your business structure, you will be expected to add a registered agent office when you file your Articles of Organization with the Secretary of State or other official government agency.
You can find registered agents for as cheap as $30 per year simply by googling the state you’d like your LLC in and registered agent.
For example, “New Mexico Registered Agent”
Apply For LLC
(I personally have an LLC in New Mexico, they have good tax benefits for online businesses and only charge a $50 fee per year. Delaware is another great state to create an LLC. You don’t need to live in the same state that your LLC is in.)
After you’ve verified your name is available and have gotten a registered agent, the next step is to file for your LLC.
You’ll do this by navigating to the Secretary of State website for the state that you’d like to create your LLC in.
For New Mexico, it’d be
https://www.sos.state.nm.us/business-services/start-a-business/domestic-nm-llc/
Choose e-filing and complete the requested information.
There is a filing fee which should be around $150-250
Business Bank Account
Once you’ve gotten your articles of incorporation from the secretary of state, you can now file to open a business bank account. Chase is the easiest to open a business bank account with and next it will be wells fargo.
You will need to take your EIN number, Articles Of Incorporation, 2 forms of identification (ID, Passport, etc.)
When they ask what type of business it is simply say business consulting.
Once you’ve received your bank information, you can now set up a payroll service.
Payroll Software
When trying to prove income, it can be extremely hard when you don’t have a normal job that gives you a W-2.
When wanting to make big purchases like houses, cars, even apartments, you’ll be asked to show proof of consistent income from anywhere from 3 months to 3 years.
By using a payroll software you can pay yourself a salary from your business bank account to your personal bank account which will create a legitimate paper trail.
This will allow you to prove income while being your own boss.
Congratulations on starting your trading business!
I recommend finding a good CPA that can help you navigate from this point on in your journey as I am not a tax professional.
Tips:
- Never tell banks that you are a forex trader! They’ll automatically turn you away
- Make sure that you only use your business bank account for business transactions/expenses