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Strategies & Market Trends : Shorting stocks: Mechanical aspects

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To: Q. who wrote ()9/4/1998 2:51:00 PM
From: David Penfield  Read Replies (1) of 172
 
Holding period for short-sell profits:

As I remember, the IRS publications state that the holding period for short-sell profits is the amount of time that you hold the property that is used to close/cover the transaction. Ordinarily this is a very short time and as such short-sell profits are taxed at the short term rate. Can I get short-sell profits taxed at the long term rate if I "box" the position for a year and then use the long part of the box to cover the short part?

Of course this strategy may require tying up some margin during the "holding period."
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