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Strategies & Market Trends : The Covered Calls for Dummies Thread -- Ignore unavailable to you. Want to Upgrade?

To: Lonnie who wrote (4871)	4/1/2007 2:23:32 PM
From: alanrs	Read Replies (1) \| Respond to of 5205

I use Quicken and it is pretty much useless for options and it also has no clue as to the wash sale rules. For my own records I sell the option and then buy it back for $0.00, whether it is exercise or not, assuming I am still holding it at expiration. I then sell the stock (or buy it in the case of puts) at the strike price. For the IRS I use Gainskeeper, which costs me around $75 per year. There is another online accounting service I've run into that was recommended as being better/cheaper than Gainskeeper, but I don't recall the name. ARS

To: Lonnie who wrote (4871)	4/1/2007 2:23:44 PM
From: Uncle Frank	Read Replies (3) \| Respond to of 5205

>> If I sell stock as a result of this, my cost basis is increased by the call I sold. That's not the way Fidelity reports it to me, or the way I report it to Uncle Sam. Cost basis is unchanged. The revenue from the sale is increased by the amount of the covered call. That makes sense, because, in the case of a long term holding, it wouldn't make sense to adjust the purchase that happened years ago. But the revenues from the covered call and the exercised sale of the stock occur roughly at the same time. But wtfdik? Check with your accountant or broker. duf