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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Harry Sharp who wrote (33816)	1/16/2000 5:55:00 PM
From: w0z	Read Replies (1) \| Respond to of 70976

Harry, your quote from the IRS seems fairly clear to me...the cost basis is the option price plus exercise price but the acquisition date is the date of the option exercise...not the earlier option purchase date. I usually just sell my options since I do most of them in a tax-deferred account. However, since this one is in a taxable account it appears I need to hold the stock until January 15, 2001 to get capital gains treatment. Thanks to all for your inputs...I'll definitely check this out before selling the stock!

To: Harry Sharp who wrote (33816)	1/17/2000 11:11:00 AM
From: SecularBull	Read Replies (2) \| Respond to of 70976

You are correct, the option holding period is added to the holding period for the stock. Buying an option after selling a stock does not violate the wash rule, IMHO. The equity is very different from a call. Regards, LoD

To: Harry Sharp who wrote (33816)	1/17/2000 9:23:00 PM
From: Robert O	Read Replies (1) \| Respond to of 70976

Not really Harry. Not to beat a dead horse (again), but it does not appear that G. Rasp was stating he 'believe[d] that the option holding period is added to the stock holding period for purposes of determining LT gains.' Instead, he simply thought that the option is 'treated the same as the stock' i.e., the ONLY point he tries to make is that an option in an underlying security is effectively the same as holding the underlying security for purposes of the wash-rules and for helping make Gregory's point that the option is treated like the stock. I don't think he was following the chain all the way back to the initial idea of whether that means one should combine the holding periods. He only wanted to agree with the point that options are 'effectively' the same as the stock. If he is tying back to the original post why not differentiate between exercising the option and selling the option on the secondary market? Does everyone agree that if I hold, say, 100 puts on AMAT bought in June at 3 each and I sell that option in the secondary market before expiration at 2 each... that within 12 months I have a S-T capital loss and after 12-months I have a long term Capital loss? G. Rasp specifically makes reference to buying calls, and only as a way to 'hold' the position in the underlying after having sold the shares. He's not in any way even contemplating the idea of exercising there, only hoping the value of those calls will increase as the stock price increases as he waits out his 30 days. then he sez this is: '..not allowed as the options are treated like the stock (at least for purposes of this example). Part of my rational is that he never references holding period at all, though he does reference a 'situation' so maybe I'm wrong..then again he labels his post as OT so maybe it was just in response to the post he linked to..making my point. Gracious, why continue this banter will Mr. Rasp take the lector and 'out' the secrets of his mind? This post is worse than Duker blasted on Starbucks (again). RO