PayoutTaxTopstep payout taxes in New York
Updated November 8, 2026 · For the 2026 tax year
A Topstep payout has no tax withheld, federal or New York. On top of federal income tax and self-employment tax, New York taxes it at its graduated rates. For a single filer with a $70,000 day job, a $5,000 payout needs $1,979.69 set aside.
PayoutTax isn't affiliated with Topstep. The Topstep details below come from its help pages, as summarized in the Topstep tax guide; the New York figures come from the PayoutTax 2026 tax tables, each linked to the state source.
How Topstep reports your payouts
Topstep emails a Form 1099-NEC to US citizens. It sent the 2025 forms on January 31, 2026, to US citizens with over $600 in payouts, and says to check your spam folder if yours doesn't show up. Questions about the form go to 1099support@topstep.com. For payments made in 2026 the IRS threshold is generally $2,000, and Topstep's page doesn't say which line it will use for 2026 payouts. Either way, a payout with no form is still New York income.
Topstep collects a W-9 from US citizens, and a US single-member LLC can receive payouts (C-corps, S-corps and multi-member LLCs can't). The form shows your gross payout, before processing fees.
How New York taxes a payout
New York taxes income on graduated brackets, from 3.9% to 10.9% for a single filer, after the standard deduction of $8,000 (2026 Form IT-2105 instructions). New York AGI starts from federal AGI, so the deductible half of self-employment tax lowers it.
Once New York AGI passes $107,650, the tax computation worksheets add a supplemental tax that phases in over the next $50,000 of AGI, and the calculator follows them. New York City tax and the MCTMT are not included.
| Taxable income (single) | 2026 rate |
|---|---|
| $0 to $8,500 | 3.9% |
| $8,500 to $11,700 | 4.4% |
| $11,700 to $13,900 | 5.15% |
| $13,900 to $80,650 | 5.4% |
| $80,650 to $215,400 | 5.9% |
| $215,400 to $1,077,550 | 6.85% |
| $1,077,550 to $5,000,000 | 9.65% |
| $5,000,000 to $25,000,000 | 10.3% |
| Over $25,000,000 | 10.9% |
How much to set aside in New York
Single filer, $70,000 of W-2 wages, no trading costs, one payout in 2026. These are the calculator's numbers.
| Payout | New York tax | Set aside | Share |
|---|---|---|---|
| $1,000 | $50.19 | $395.94 | 39.59% |
| $5,000 | $250.93 | $1,979.69 | 39.59% |
| $10,000 | $501.85 | $3,959.38 | 39.59% |
| $25,000 | $1,277.54 | $9,921.37 | 39.69% |
| $50,000 | $2,748.58 | $20,036.23 | 40.07% |
The share rises from 39.59% to 40.07% as bigger payouts reach higher New York brackets.
A $5,000 payout, line by line
| Tax on the payout | New York | Texas |
|---|---|---|
| Federal income tax | $1,022.29 | $1,022.29 |
| Self-employment tax | $706.48 | $706.48 |
| State income tax | $250.93 | $0.00 |
| Set aside | $1,979.69 | $1,728.76 |
| Share of the payout | 39.59% | 34.58% |
The lines can differ from the total by a cent, because the calculator rounds only at the end. The same payout in Texas is shown for comparison.
Topstep's $500 example in New York
Topstep's help page uses a $500 payout request with a $30 processing fee: the 1099-NEC shows $500 and you receive $470. Topstep says to deduct the $30 as a business expense on Schedule C. For a single filer in New York with a $70,000 day job, the calculator puts the set-aside at $186.09 once the fee is counted, against $197.97 if you forgot it. Payouts through Wise have no processing fee, so the form and your deposit match.
If Topstep is your only income
With no day job, the deductions that a wage would use up come off your payouts instead, including New York's $8,000. On $60,000 of payouts, New York tax is $2,414.10 and the whole set-aside is $15,403.17, or 25.67%.
Paying it during the year
The 1099-NEC arrives after the year ends, but the tax is due during the year. The next federal estimated payment is due January 15, 2027 (the January payment guide explains it), and payouts go on Schedule C and Schedule SE when you file. New York estimated payments have their own rules; PayoutTax's quarterly amounts cover federal tax only.
What the estimate leaves out for New York:
- NY tax uses its 2026 brackets, deductions and personal exemptions or credits only (no dependents, other credits or local taxes, and no New York City tax).
- Does not include the qualified business income (QBI) deduction, credits, other income or itemized deductions. You may qualify for the QBI deduction, which would lower the federal tax; ask your CPA.
Run your own wages, costs and payouts in the free calculator, or read the New York guide. The set-aside table by state compares every state on a $1,000 payout.
These examples are for one situation, and yours will differ. Estimate only, not tax advice. Confirm with a CPA.
Topstep in other states
California, Texas, Florida, Pennsylvania, Illinois, Georgia, North Carolina, Michigan and New Jersey.
Other prop firms in New York
Tradeify, MyFundedFutures, FundedNext Futures and Bulenox.
Sources
- Topstep, Funded Trader Tax Questions: who gets a 1099-NEC, the 2025 send date, gross payouts and fees, W-9, LLC rules. Read November 6, 2026
- IRS, Am I required to file a Form 1099 or other information return?: $2,000 threshold for 2026
- New York, 2026 brackets (tax.ny.gov)
- IRS, 2026 Form 1040-ES: self-employment worksheet and federal due dates
- PayoutTax 2026 tax tables: every figure the calculator used, each with its source
General information, not tax advice. This guide explains common rules for US funded traders; your situation may differ. It isn't a substitute for a licensed CPA or IRS enrolled agent, so review your own numbers with one before you file or pay.