Needs review help for expired put options

[ravi303]

Turbo tax is flagging PUT options that expired worthless with ZERO cost basis as Needs review. Upon editing what do we select for "Sold or Expired"? Since the put option expired worthless and whatever premium received was proceeds but upon selecting Expired option it ZEROs out the proceeds, which I think is not correct. Please advise how to proceed with reviewing these transactions.

[Mike9241]

since these are short sales what are you using for the dates

i use for date acquired - date position closed/expired

for sales date I use sold and date position opened  - not expired (a contradiction because they did not expire on the date the short position was opened. 

i also reversed dates but still had to use "sold" to avoid the proceeds box from disappearing. evidently with Turbotax expired can only be used with long positions

also for short sales cost can not be blank. 0 is required for those expiring. 

[ravi303]

yes dates are exactly as you mentioned to make it very clear let me provide one example of a cash secured put option that was expired,

For example,  PUT VZ MAY 00036.000 VERIZON COMMUNICATNS COM EXP 05-05-2023

This was expired as below,

Acquisition Date Liquidation Date Quantity Acquisition Price Acquisition Cost Liquidation Price Liquidation Amount Gain/Loss
04/26/2023 (Short Term) 05/08/2023 -1 $0.14 -$14.34 $0.00 $0.00 +$14.34

In 1099-B

1b. Date Acquired 1c. Date Sold or Disposed 1d. Proceeds 1e. Cost Basis 1f. Accrued Market Discount 1g. Wash Sale Loss Disallowed Gain or Loss
05/08/23 04/26/23 14.34 0.00 0.00 0.00 14.34

So if you see the proceeds are 14.34 but once we try to edit because of needs for review, I select the trade as option and then I select that as Expired, the proceeds goes away and upon editing proceeds becomes ZERO. And of course the cost basis is ZERO as you can see above in 1099-B

So, I am not sure how to fix this, I would appreciate if someone when through this issue and is able to help

[DavidD66]

For short puts that expired, instead of using "Expired" as the closing date, enter the actual expiration date.  You can also report your 1099-B using Summary Totals by Category.  You won't have to enter any dates.  If you want to do that and you imported your 1099-B you will have to delete it.  Restart the 1099-B entry process and indicate you will type it in yourself and indicate you want to enter category  totals.  

[ravi303]

For expired puts with zero cost basis the data imported from 1099-B is correct with respect to dates, the sell date is the date when the put was sold which is box 1c, acquisition date is the date when the option expired which is box 1b. Note the date sold comes before the date acquired in these cases. This imported dates matches with 1099-B don't see a issue there the problem is when it asks for Needs review, there is a Radio button with two options "expired" or "sold", if you select expired proceeds will become zero (which seems incorrect) and it won't match what is reported on 1099-B. if we select "sold" then the proceeds amount remains intact (although option was actually expired). I was on call with the customer representative for hours explaining how options work and explaining the problem but even she was confused looking at the screen about which option to pick (not sure why turbotax makes a note of this), upon discussion for few hours we concluded that it is probably a good idea to choose "sold" because that would match the data reported in 1099-B. Not totally convinced with the solution but I guess there is no other choice at the moment.