Prop firm taxes calculator

For US funded traders paid on a 1099-NEC with no tax withheld. Enter your 2026 numbers so far to see how much to set aside and when the IRS expects it.

Payouts received in 2026 Trading costs in 2026 Eval fees, resets, activation, data, platforms More payouts you expect before Dec 31 (optional) Used for the quarterly and penalty-safe amounts, so they cover your whole year Day-job income (W-2) for 2026 Filing status State

More accurate: withholding and last year's tax

Federal tax withheld per paycheck From your pay stub Pay frequency Last year's total tax 2025 Form 1040, line 24 Last year's AGI 2025 Form 1040, line 11a Estimated payments already made in 2026

How prop firm payouts are taxed

Most prop firms pay US traders as independent contractors and report payouts on a 1099-NEC. Nothing is withheld. Payouts minus your trading costs are self-employment income: you pay income tax on them at the rate your day job already puts you in, plus self-employment tax (Social Security and Medicare) of about 15.3% on 92.35% of the net.

Because nothing is withheld, the IRS expects you to pay during the year: quarterly estimated payments (Apr 15, Jun 15, Sep 15, Jan 15), or more withholding from your day job through a new W-4. Withholding counts as paid evenly through the year, so raising it late in the year still helps.

The 60/40 rule for Section 1256 futures contracts generally does not apply to prop firm payouts, because you are paid for a service, not for trading your own account. Confirm your situation with a CPA.