Originally Posted by
Seneca Pilot
Futures and options on futures and indices are 1256 contracts. There is no single trade reporting like there is with individual stocks. You just get a 1099. 60% long term capital gains rate, 40% regular income rate. Get your tax advice from an expert but that is the treatment for options and futures.
FIFY (he types in a polite, respectful manner, not often seen on the interwebs)
I could have been a little more specific in the original tax question. I'm still at the equity option level, I'm saving futures for when I really hate my kids and want to blow their inheritance. Options on equities are not 1256 contracts based on my pilot level understanding of the tax code. Options on ETFs and individual equities are taxed as ST CG. The difference in tax treatment is one reason it may make more sense to sell options on SPX vs SPY (index vs equity). I'll ask my CPA the next time we talk, probably Jan/Feb. It looks like single trade reporting summed up in an annual P/L is the requirement for my trades.