There are limited tax benefits of an LLC other than preventing self-employment tax – as it is a pass through entity. It does provide some Asset Protection such as avoiding charging orders if it is not a single member LLC. If you stuff up elsewhere but do not do anything illegal a properly structured plan using an LLC is all most traders need.
If you make significant money there are far better structures to use i) A C Corporation is the ultimate for Asset Protection and Tax planning – anyone raising the issue of double taxation is an amateuer. ii) Offshore Prop Traders can avoid tax on all trading profits and offers substantial asset protection. It is unlikely you can achieve the right structuring if you are unfamiliar with the law and lack experience & contacts
(I ran an Offshore Law firm until the GFC – specializing in Tax and Asset protection for US business owners. With Political Demonstrations disrupting commerce in Hong Kong I am looking for suitable alternative jurisdictions).
Laws have progressively tighted since 2001 when legislation changes & International Agreements became more solid and whistle blowers brought down many cardboard shelters. Do it yourself smarties are their own undoing – Controlled Foreign Entities Rules are stronger than most individuals looking for a fight with Governments.
Many of the major International Banks (e.g. UBS, LGT, HSBC) and Big Accounting Firms left clients out to dry. Arthur Anderson was brought down by the Enron Scandal