2006-06-13 09:26:05 · 2 answers · asked by phantomtrader2 2 in Business & Finance ➔ Investing
Yes, it's investment income and subject to taxes. Normally, you would report such income on your Schedule D.
The particular section of the tax code is here: http://www.irs.gov/publications/p550/ch04.html#d0e12764
2006-06-13 09:30:02 · answer #1 · answered by Arbitrage 7 · 0⤊ 0⤋
The general answer is Yes.The difficult part is how much......depends on a number of factors. You really need expert advice on this one - ask your broker for a lead to specific information for your particular situation.
1- Put or Call ?
2- Index or equity underlying ?
3- the strike price (how "deep-in-the-money" was the option when you sold it and when you closed it out or the option expired?
4- did you close out the option by buying it back or did the option expire?
5- was it worthless at expiration?
All these can affect what you may have to pay.
2006-06-13 17:00:27 · answer #2 · answered by jrpower60614 1 · 0⤊ 0⤋