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taxes

Options - calls

My download from Morgan Stanley wealth management did not download call options that lost money.

Missing entries are in the Morgen Stanley data base from which the other data was downloaded.  Other options

, puts and options that made money downloaded properly. 

 

Is this a program bug or don't that do options?

 

 

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1 Reply
DavidD66
Expert Alumni

taxes

If you sold covered calls that don't meet the requirements of a "qualified" covered call (QCC), then it’s considered "unqualified" and is taxed as a straddle.  Generally, QCCs are options written with an expiration date greater than 30 days and a strike price that is not "deep-in-the-money" (see IRS Publication 550 for more information).   Non-QCCs are treated as straddles. Also, non-equity call options (e.g. index futures, currency futures, commodity futures) are treated as section 1256 contracts. The items are not included on Form 1099-B, although they are almost always listed on a supplemental schedule with the 1099-B.  Because they are not part of the Form 1099-B, they will not import into TurboTax.  

 

Straddles and Section 1256 contracts are reported on Form 6781.   If you have straddles or Section 1256 contracts, to report them in TurboTax:

 

  • Click on Income
  • Scroll down to "Less Common Investments and Savings"
  • Next to "Contracts and Straddles" select "Start"
  • Answer "Yes" to "Any Straddles or Section 1256 Contracts?"
  • On the next screen, it is highly unlikely that you need to make any elections, so just click "Continue"
  • On the screen with "Contracts and Straddles", more than likely you only need to select Section 1256 contracts...  You may want to read the IRS instructions for Form 6781, Gains and Losses from Section 1256 Contracts and Straddles
  • Select "I'll report the totals from each broker or account.
  • Enter the information to report your your profits and losses from your Section 1256 Options transactions.   
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