How do you report options results to the IRS?

Answer 1

If you are talking about compensation in options from your employer, see

http://www.fairmark.com/execcomp/index.htm

If you are talking about exchange traded options, it depends on a few things.

If you wrote an option and you were assigned, or if you exercised a long option, you did not have a reportable gain or loss. Instead you adjust the price of the underlying by the option premium.

If you had an option (long or short) that expired worthless treat it as if the position was closed for zero dollars on the expiration date.

If you simply opened and closed an option position, without an offsetting position, simply report it on Schedule D unless the option was a Section 1256 contract. (A Section 1256 contract is normally a cash settled option on a broad based index.)

If you had an offsetting position (a position that substantially reduces any risk of loss you may have from holding another position) there are a special set of rules that apply. Unless the offsetting position is a "qualified" covered call you will need to fill out Form 6781. (See the section on "straddles" beginning on page 58 of IRS Publication 550.)

Answer 2

The Form 1040, Schedule D gives you the reporting requirements, whether it be for stocks, bonds, options, ETFs or other financial instruments.
Just fill in the lines.
However, the question is "How do I report them"? I don't. Since I lose money every year, these do not give me any profit. I am too proud to report my losses, so I skip that all together.