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Strategies & Market Trends : Income Taxes and Record Keeping ( tax ) -- Ignore unavailable to you. Want to Upgrade?

To: Colin Cody who wrote (499)	1/22/1998 7:47:00 PM
From: VincentTH	Read Replies (1) \| Respond to of 5810

I will look up Tesser tonight when I came home, but I remember vaguely that is was at the end of the book. On the other hand, McMillan in "Options As A Strategic Investment" said the same thing you stated: i.e., since the call strike is near At The Money, I don't have to report the premium for '98 unless it is exercised in '98. Thanks, you've been of great help to us small investors, and I am one of those lurkers who read everything you wrote.

To: Colin Cody who wrote (499)	1/23/1998 4:07:00 PM
From: VincentTH	Read Replies (1) \| Respond to of 5810

I read Tesser again, but can only find a reference to option in the Appendix (pp 280-). Tesser said that equity options are not marked to market, and therefore not required to report until the transaction is closed (i.e. at expiration or assignment). (That's how I remember it as "vague"). McMillan goes into details as to how one should report income from option tradings, similar to what you have stated (deep ITM calls, etc...). I don't know how to judge McMillan's credentials as far as tax is concerned, however, but since he is the option guru, I would tend to believe him. I will read McMillan again, especially the LEAPS section.