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To: DaveMG who wrote (26899)	4/13/1999 4:02:00 PM
From: Sawtooth	Read Replies (1) \| Respond to of 152472

I'll take a whack at that just to dangle out some bait for anyone who thinks I'm wrong: The way I understand it is: If you exercise your option, the call, the basis in the stock acquired is the exercise price plus the cost of the call plus all commissions and any other transaction costs. Tax is due when you sell the stock, assuming you have a net gain. If you buy and sell the option without exercising it, the taxable event is the gain on the option transaction, adjusted for commish and any other costs. Since I'm not big into stock option transactions, I look forward to any correcting comments. ...Tim

To: DaveMG who wrote (26899)	4/13/1999 4:18:00 PM
From: Jon Koplik	Read Replies (1) \| Respond to of 152472

One needs a "P & S" (purchase and sale) to have a taxable event. If one exercises a call option, there is no P & S (yet). Jon.

To: DaveMG who wrote (26899)	4/13/1999 5:15:00 PM
From: Caxton Rhodes	Read Replies (1) \| Respond to of 152472

Dave- I'm going to be exercising a few may 75s. You just call your broker (i.e. Chuck) the Friday before and tell them to exercise. For tax purposes, the purchase date is the exercise date on your statement and the purchase price is the exercise price plus what ever you paid for the options including commissions. There is no advantage to exercising earlier than the last Friday. It will do nice things for your margin account, i.e. say exercising 10 may 75s will cost you 37.5k cash (50% of 75k) but you get 170k in equity. Rock on. Caxton