Profits, Losses and Taxes


If I am placing large $ amounts relative to the potential payoffs, how will this influence my taxes at the end of the year?

For example.

  1. 30$/30$ hedge to gain potential 40$. I am spending 60$ to gain 40$.
  2. 40$/40$ hedge to gain potential 20$. I am spending 80$ to gain 20$.

Because from Nadex I receive a “payment” of 100$, does this mean that I am taxed on “100$” amount?

Also what if I made a 1000$ in a year… but I lost it all before the end of the year? I assume taxes apply to all profits (I also understand there are different tax rates, but for now, I’m curious about when profits are simply taxed)




If you make 100 on one trade and lose 60 on another – you made $40

Settlement payout does not mean profit - it is risk + profit on that trade - if combined with other trades its net profit that counts -

Please see the link Mark provided


Thanks for the link.

I see so it’s a yearly net. Million dollars gained, then lost would not see any tax at the end of the year. Thanks again.


At the end of the year, whatever you gain you’ll be taxed 15% for it. Ex. 2014 profit: $10,000.00 Tax (15%): $1,500.00

That’s on the Federal Level. Not sure about your particular State.