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I'm confused as to how taxes will work for some options that I bought in the first half off 1999. In March, I got into options for gasoline since it was just so darn cheap. I didn't really know what I was getting in to, but I knew that prices would go up. Sure enough, I turned $6,000 into $9000 in three weeks. I became deliriously excited with what I had done (my first financial investment ever), I decided to get right back in and do the same thing again. However, prices stagnated for the next 2.5 months so that my options expired worthless. All $9,000 were gone.
That's where my question comes in. Since I gained $3000 on the initial $6000, but then lost all $9000 some months later, will I be taxed? I appreciate any help on this matter.

greedy(maybe that should be stupid)punk
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If I have read you post correctly, youa ctually had two completed transactions:

1. Bgt option for $6k, sold for $9k, therefore $3k gain.

2. Bgt option for $9k, expired, which is the same as a sale for $0; threfore $6k loss.

You report both of these transactions on Schedule D in the short term area. The net is a $6k loss which is offset by any other capital gains transactions you might have had in 1999. If this is all there was, then you will be able to deduct $3,000 in 1999 and you will have a short-term loss carryforward of $3,000 into 2000.

TheBadger
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