Income Taxes and Record Keeping ( tax ) Message Board

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Strategies & Market Trends : Income Taxes and Record Keeping ( tax )

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To: Colin Cody who wrote (750)	3/9/1998 1:26:00 PM
From: James Unterburger	Read Replies (1) of 5810

Actually, going short against the box is considered a constructive sale only if it's an appreciated position. And yes, going long against a short position would be the same, only be careful of the "enter" and "exit" effective dates for the position. Since I did not have an "appreciated" position, I did not have to worry about the constructive sale rule I was losing money every step of the way. That and the fact that this all happened in a single tax year. "Appreciated" means one that you are in the money on. "Constructive sale" means that going short against the box is really the same as simply selling what you own; that is the IRS says OK, any paper gains must be treated as real gains as soon as you go short.

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