Yes, the option to summarize transactions by a broker is the first option - Section 1256 contracts marked to market. Under these rules, each section 1256 contract held at year-end is treated as if it were sold at fair market value (FMV) on the last business day of the tax year. The wash sale rules don’t apply. If your section 1256 contracts produce capital gain or loss, gains or losses on section 1256 contracts open at the end of the year, or terminated during the year, are treated as 60% long-term and 40% short-term, regardless of how long the contracts were held. Index options follow these rules.
The mark-to-market rules don’t apply if you properly and timely identified a section 1256 contract as a hedge.
A section 1256 contract is any:
• Regulated futures contract,
• Foreign currency contract,
• Nonequity option,
• Dealer equity option, or
• Dealer securities futures contract.
For definitions of these terms and more details, see section 1256(g) and Pub. 550.
These contracts are reported on Form 6781. The form link has instructions that summarize the terms and elections used. The Pub. link above is detailed.
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