Only Box 11, needs to be entered since it is the 'Aggregate Profit/Loss on Contracts'. A Section 1256 contract is a type of investment defined by the IRS as a regulated futures contract, foreign currency contract, non-equity option, dealer equity option, or dealer securities futures contract.
What makes a Section 1256 contract unique is that each contract held by a taxpayer at the end of the tax year is treated as if it was sold for its fair market value, and gains or losses are treated as either short-term or long-term capital gains.
- With your TurboTax return open follow the steps next
- Under Investment Income, click Start/Update on "Contracts and Straddles"
- Continue twice and check the box for Section 1256 contracts marked to market.
- Continue to complete the prompts on each screen
You will find that TurboTax offers only two boxes for Line 11 (a gain or a loss) and that is all that has to be entered.