Tuesday, April 4th, 2017

What are the tax implications of options trading?

If I use a straddle option strategy, and bring in $ 100K during the year, but lost $ 90K on the other side of the porch, I have to pay taxes on $ 100K, or only in the $ 10K that was actually with? If I have to pay tax on $ 100K, am only allowed to deduct the maximum loss of $ 3 K? Thanks!

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Comments

2 Responses to “What are the tax implications of options trading?”
  1. naekuo says:

    If these are the realized gain and losses (you actually sold and bought) that you’ve, you 10k will be your net gain. You got to remember to include the option that expired as part of the losses.

    Just in case, you’ve got net losses at the of the year. You can only deduct up to $3,000 on your individual tax return per year.

  2. George says:

    Hello guys,
    I just tried the historical simulation on this option software and it really improved my trading skills.

    Option Software

    BTW its FREE.
    George

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