Reporting a box spread (box trade) on turbotax properly.

[Ionnowhy]

Just want to make sure that this is the proper way to report a section 1256 transaction that was used to take a loan using a box spread (https://thefinancebuff.com/short-box-spread-vs-margin-loan-fidelity.html)

Let us assume Box 11 on form 1099B has a negative amount (say -100).

In Turbotax, for form 6781,

I would select none of these for a box spread:

1. Mixed Straddle election
2. Straddle by Straddle identification election
3. Mixed Straddle account election
4. Net Section 1256 Contracts Loss election

On the next screen with the following options:

1. Section 1256 contracts marked to market 
2. Losses from straddles (Assuming I enter 2nd and 3rd trades here?)
3. Gains from straddles (assuming I enter 1st and 4th trades here?)
4. Unrecognized gains from positions held on Dec 31,2022
5. None of The above

Lastly enter the selected account owned by, the broker name, and entered total losses (-100)?

I choose none of the above for the last section?
hedging transaction
foreign currency (treat as ordinary income or loss)
foreign currency (treat as capital gain or loss)
None of the above

 When I do this, only part I of form 6781 is populated. In Part I, 

Aa: Name of broker

Ab: Description

Ac:-100

Ad: <Nothing fills here>

Ae: T

Af: <Nothing fills here>

Line 1,2,3,5, and 7: -100

Line 8:40

Line 9: 60

Rest of the form is empty. Is this the right way to report the transaction?

These losses carry over to my capital loss worksheet.

Thank you.

[DawnC]

Yes,   Box 11 on 1099-B is the aggregate of realized and unrealized gains and losses for the year.    You can claim $3K in net losses each year and carry over additional losses to future years.   You would mark Net 1256 Contracts Loss Election only if you wanted to carry back losses to the 3 prior years.   Form 6781 explains all of the possible elections.

Mark the Section 1256 contracts Marked to Market box.   Then choose I'll report the totals from each broker or account.    You don't need to mark the Gains from Straddles or Losses from Straddles for amounts in Box 11 - you can use 1256 Marked to Market option to summarize your entries.  

In your example, you see, Part 1 of Form 6781 completed with a short-term loss on line 8 and a long-term loss on line 9.   Part ll (don't include positions if all parts of the straddle are 1256 contracts) and Part lll (unrecognized gains) will be blank if reporting amounts from box 11 from Form 1099-B (aggregate 1256 contracts).   The rest of your numbers matched my Form 6781 numbers when I entered a $100 loss from Box 11.    The amounts transfer to Schedule D - Capital Gains and Losses.  

The ''T'' in column e of Part 1 stands for ''taxpayer owned''.   It could be your spouse's account (S) or a joint account (J).    

See What is Form 6781 - Gains and Losses from 1256 Contracts?