Can some explain me how i can input my multi-leg options trading positions, which i bought and sold within short time? All trades were opened and closed within same time.

[jimmieisb]

I have already pulled all data from my Fidelity and TD Ameritrade accounts, but Turbo Tax asks me if i traded straddles? and as per IRS rules all multi-leg trades which have opposing/counter balancing trades are called straddles. These include, Straddles, strangles, Vertical Call spreads (bought or sold), Vertical Put Spreads (bought or sold) etc I have done all above, but they were not against any long or short stock, i did not held any stock for these securities.

[fanfare]

what tax  document do you have?

consolidated 1099-B? or substitute 1099-B for Futures and FOREX?

[fanfare]

since you mentioned " no  stock" I guess you are trading stock options.

[jimmieisb]

Its consolidated 1099.. doesn't say B, not for Futures or Forex.

[jimmieisb]

Yes these were stock options trade using strangles, straddles and vertical spreads.

[jimmieisb]

Sorry FanFare, it does say 1099-B. thx

[fanfare]

you are not a professional engaged in hedging operations.

your option trades are covered transactions.

 I recommend the summary reporting option since covered transactions do not require Form 8949. No mailing is necessary.

[jimmieisb]

Thanks Fanfare, but should i select Straddles on turbo tax? and what i need to elect after that? See my possible elections in attached pictures. See following Qs:

1. As per IRS form 6781, the selections i make this year will be permanent (can only be changed after contacting IRS). So i need to be sure what i am electing based on my trading style.

2. If i have imported my 1099-B in the tax software here, which includes all trades, why i should go and fill out the straddles again?

3. N what if i may have some missing or unaccounted trades in my form 1099-B. I bought and sold Puts as well, but the form 1099-B only marks trades as Calls (difficult to decipher, trying to figure this out with broker)

4. For year 2021 I am currently trading Cash Covered Puts and Covered Calls. How the elections i will make today will affect my tax filing next year?

Please let me know as much as possible.3rd selection4th selection2nd selection1st selection

[jimmieisb]

Actually the 3rd election is 4th (last election to start entering data).

[fanfare]

As I tried to explain, perhaps not too clearly, you don't file Form 6781.

[fanfare · Accepted solution]

Use Form 6781 only for futures contracts, options on futures, or FOREX currency that you have elected to treat under section 1256. Even then you are not a Professional , so you would not check any boxes except perhaps D if that applies. You don't want that one to be applicable.

[jimmieisb]

Hi Fanfare, you mean "Unrecognized gains from positions held on December 31st 2020"??, Yes i have 1 Vertical Call Spread on options, which i sold in 2021 (so i will need to fill in this table, see picture) and select no other elections?? basically skipping all the steps i mentioned earlier in pictures. Right?

[jimmieisb]

[fanfare]

As I tried to explain, perhaps not at all clearly, you don't file Form 6781.

Instead, file Schedule D.