a tax question on option trade

**yuexu** Wed Feb 08, 2006 8:14 pm

a tax question on option trade
I am using scottrade broker. I have some option trades every year, most of them are covered calls. Now, its the time for income tax.

Each year, scottrade sends me 1099 forms, including white and blue forms. White form is "the sold" records, reported to IRS. Blue forms is my own records for references to fill the "cost". Althought the blue form lists all the option transitions, the white form does not list any thing about option.

I usually report all options just like stocks, so the total number will never match the white form.

This year, I called scottrade, ask them what should I do? Their answer makes me supprised: "We only report stock transitions to IRS, never report option tradings. As what you should do, it is completely up to you."

I know this is not right. I should not make the numbers match perfectly with their white form by not reporting option trades.

Anyone here has the same experiences?

Thanks

**blast_investor** Wed Feb 08, 2006 8:46 pm

Hi yuexu

I believe that scottrade is right.

Option sales are not required to be reported in 1099.

**yongxin** Wed Feb 08, 2006 11:33 pm

Amritrade does not report neither. So as ARLP's distrubution. What about the option gain/loss? How about no K1. Ameritrade did say the Partnership Distibution not reported to IRA in their 1099.

**blast_investor** Wed Feb 08, 2006 11:56 pm

option gain/loss tax filing is investor's responsibility, brokers do not care about that.

yongxin wrote: Amritrade does not report neither. So as ARLP's distrubution. What about the option gain/loss?

**yuexu** Thu Feb 09, 2006 5:52 am

Thanks, Blast.

**14417335** Thu May 04, 2006 9:16 pm

Premium from selling call options is a short/long term capital gain

http://www.smartmoney.com/print/index.cfm?printcontent=/tax/capital/index.cfm?story=options2[/b]