<<I recently began writing covered call options. Can anyone tell me how this additional income ploy is treated taxwise ?( I seem to remember it's treated as normal dividend income.)>>Check back in this folder for additional discussions on this point. Option trading can be very complicated from a tax standpoint, and you should be well aware of ALL of the ramifications before trading. It is WAY to complicated to deal with in this folder. Not only that, while writing covered calls may be a viable investment strategy for you (emphasis is on MAY), it is not found in the Fool Fhilosophy. That being the case, spending a great amount of time on options plays are not what this board is about. GENERALLY, the expired premium that you will receiv on the expiration of the option (less broker costs and commissions, of course) will be treated as a capital gain (usually short term, and NOT as dividend income.For additional information on options, you can read IRS Publication 550. You should also visit your local bookstore and purchase additional reading material that will bring you up to speed on the tax issues of options plays.You can get IRS Publication 550 by calling IRS at 1-800-TAX FORM. Or you can visit the IRS web site at: http//:www.irs.ustreas.govHope this helps a bit...TMF TaxesRoy Lewis
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