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The following is what Pub 550 says regarding puts or calls that are assigned on stocks:

"If a put you write is exercised and you buy the underlying stock, decrease your basis in the stock by the amount you received for the put. Your holding period for the stock begins on the date you buy it, not on the date you wrote the put.

If a call you write is exercised and you sell the underlying stock, increase your amount re-alized on the sale of the stock by the amount you received for the call when figuring your gain or loss. The gain or loss is long term or short term depending on your holding period of the stock."

However, on my 1099 I see that my broker shows a call that was assigned as a separate item identified as Box C (not reported to you on 1099B). I found a note that said brokers were not to report Options until 2014.

I maintain a spreadsheet that reduces my basis if a put is assigned and increases the sale price if a call is assigned. I have been doing this based on my understanding of Pub 550 but now my spreadsheet does not match what my broker is providing. Am I wrong or should I contact my broker?

Ron
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I maintain a spreadsheet that reduces my basis if a put is assigned and increases the sale price if a call is assigned. I have been doing this based on my understanding of Pub 550 but now my spreadsheet does not match what my broker is providing. Am I wrong or should I contact my broker?


I agree with your understanding of 550 and would go
with that (I try to never let my calls get exercised (>:

and would feel confident because of box C

expect to be corrected if I'm wrong




http://boards.fool.com/Message.aspx?mid=30569861
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I maintain a spreadsheet that reduces my basis if a put is assigned and increases the sale price if a call is assigned. I have been doing this based on my understanding of Pub 550 but now my spreadsheet does not match what my broker is providing. Am I wrong or should I contact my broker?

Since your broker is providing nothing why would you contact them? If you have a "C" transaction to report you report it just like you always did before brokers' responsibilities were expanded (except now you report it on the 8949 rather than directly on the Schedule D).

Maybe I don't understand the question, but I can't find the problem.

Phil
Rule Your Retirement Home Fool
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Sorry I was not totally clear...

"Since your broker is providing nothing why would you contact them? If you have a "C" transaction to report you report it just like you always did before brokers' responsibilities were expanded (except now you report it on the 8949 rather than directly on the Schedule D)."

My broker provided me a document titled "Worksheet for Form 8949" which has sections for Short Term Box A, B and C plus the same for long term.

The stock in question, ABT, is shown as being sold in Part II, Long-Term, Box A as it should be. However I had sold calls on ABT which resulted in the actual sale. Those calls are listed in Part I, Short Term, Box C.

I can certainly adjust the sale price of ABT but then the number the broker reported to the IRS for LT Box A will not match my filing.

Does it make more sense now?

ron
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I can certainly adjust the sale price of ABT but then the number the broker reported to the IRS for LT Box A will not match my filing.

Does it make more sense now?


That's what columns (f) and (g) are for on the 8949.

Ira
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