Dave W

I sold covered calls on a stock I own (short-term holding period) and identified them as a straddle with the stock I own. They are not qualified. (I sold them less than 30 days before the expiration.) They expired worthless. I know I have a short term gain, but how/where do I report it? A single line on Schedule D like I would for a stock or do I have to use form 6781? If I have to use 6781, what do I put on what lines? I've never used that form before and don't really understand it.

Second situation: A few days after the previous expiration, I wrote new options against the same stock (and identified them as a straddle). I later bought the options back for a loss. I didn't have any more options transactions for 3 months, so this shouldn't be a wash sale. Because this is an "identified straddle", I think I add the loss to the basis of the stock. What, if anything, do I report on which forms? Again, if it's 6781, please help me understand what I put on which lines of 6781.

I wrote covered calls against a stock that I own (with a short-term holding period). The calls were not "qualified" because I wrote them less than 30 days before expiration. I later closed the position by repurchasing the calls at a loss.

A few days later, I wrote more covered calls (with a later expiration date) against the same stock. I believe this makes the previous transaction a "wash sale" and that I can't claim the loss, but must add it to the basis of the new position.

The question is do I report anything on my tax return for the wash sale transaction? If so, what do I put on which form (Schedule D?, 6781?) and how do I indicate it's a wash sale?

1) I was assigned on covered call options. I understand that I should add the premium received for the option to the proceeds from the associated stock sale and report that on Schedule D as part of the sale price of the stock. Is that all that goes on Schedule D? Do I report the option itself anywhere?

2) Separately, I wrote covered call options that had less than 30 days until expiration and identified them as a straddle with the related stock. I later bought back the calls at a loss. Does this count as an "identified straddle" where I just increase the basis in the stock by the amount of the loss or does that fact that the expiration date was less than 30 days away mean that it is subject to the traditional loss deferral rules? Also, what effect is there on my holding period for the stock - was it terminated when I sold the options or just suspended?

I wrote covered call options which I was assigned. I understand that I should add the premium received to the proceeds from the associated stock sale and report that on Schedule D on the line for the stock itself.

Do I report the option anywhere on the tax form or does the one line for the sale of the stock cover it all? If it does, how does the IRS match up that one line on my tax return with the numbers reported to them by my brokerage firm? All I see on the 1099 is the sale price of the stock itself, not the call option price.