Message Font: Serif | Sans-Serif
No. of Recommendations: 0
I've been through this too. See

It's quite a snafu! Jess, your situation looks like you "need" to do part II and part III of form 6781. Part I is simple and reserved for section 1256 contracts which are, mostly, commodities futures, options on these futures, and perhaps some options on stock indexes. Not the stuff that most of us fools deal in (stocks and stock options). The broker reports your mark-to-market, you put it on part I of 6781 and done deal!

But many of us unwittingly blunder into straddles and this form is a nightmare. I cannot find an automated solution that handles both straddles and does wash sales across stocks and options. Manually dealing with the form or moving trades across two pieces of software is inviting errors greater than the timing error of ignoring straddle loss deferrals.

So I too am at a loss of how to proceed. I suspect that many options investors unwittingly create straddles, lose on one leg while another remains open, and remain blissfully unaware of these complications.
Print the post  


In accordance with IRS Circular 230, you cannot use the contents of any post on The Motley Fool's message boards to avoid tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.