The structure confuses people because it looks like a loss-making business. Expenses such as market data, platform fees, professional subscriptions, education and a home office are deducted on Schedule C while the trading profit itself sits on schedule-d, so Schedule C often shows a loss by design.
Trading gains are not self-employment income, so no self-employment tax is owed on them, and that also means a pure trader has no earned income for retirement plan contributions unless a separate entity pays a salary.
Where the section-475-election is in force, trading results become ordinary income but are generally still reported through the appropriate trading schedules rather than as self-employment earnings.
General information for the United States, not tax advice. Rules change and depend on your circumstances; consult a qualified tax professional.
Related: trader-tax-status, section-475-election, schedule-d, self-employment-tax-prop-payouts, estimated-quarterly-taxes