AurorWest: Generally, yes the IRS considers the position closed on 12/31. Options have EXTREMELY complex tax rules depending upon whether they involve IRC Sec 1256 property or not, involve pure straddles, etc.

I'm not working any kind of complicated options strategy (straddles, etc.). Just holding plain vanilla CMGI March 2000 Calls. Is there a simple yes/no answer about whether these would be considered a capital gain on 12/31/99 even if I don't sell them to close?

You really need to get some professional advice especially if you are talking big $$$... it could save you big $$$ too.

I left a message on my accountant's voice mail this evening, but she never gets to the office before 10:30 am.....so I'm trying to get some insight tonight since I'm starting to worry that CMGI is getting a little toppy with 7 straight days of new closing highs. If I'm going to get hit with a tax bill regardless, I might as well lock in at least part of my profit at the open tomorrow morning.

Thanks!