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Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: kodiak_bull who wrote (40991)	3/29/2005 2:16:59 PM
From: ChanceIs	Read Replies (2) \| Respond to of 206325

"I don't think it should make a difference whether you are long a call or long a put;" Kodiak, Of course it SHOULD not make a difference. But this is the IRS. Should doesn't matter. If you have a nickle, it is surely the case that you did nothing to deserve it, or that if you did deserve ownership that you don't need it, and therefore you SHOULD give it to them. I hear what you are saying and agree, but let me tell you they have very funny rules regarding options and what it means to be long. And they are very obscure about shorting and constructive sales. Schwab was telling me the other day that these days, if you sell a reasonably deep in the money call against stock you have held, that that effectively is a sale (a constructive sale) and you owe tax immediately on the gain. What is reasonably in the money???? Who knows? I was aware of the constructive sale rule in the context of "shorting against the box," but it sounds like the buggers have extended it to new and terrifying applications.