Put or Call Option

Report a put or a call option and income produced by the option in Schedule A. 

Put or Call Option: Examples

For You, Your Spouse, and Your Dependent Children

Schedule A

Reporting a Put or Call Option That You Have Not Exercised

Report a put or call option if its value was more than $1,000 at the end of the reporting period, or if the option produced more than $200 in income during the reporting period.

Block A: Provide the name of the option, which should include the name of the underlying security and the type of option (e.g., “Widgets Unlimited (WIG), put option”).

Block B: Report the value of the option by marking the appropriate column. If the option is “underwater” or if the value of the option is otherwise difficult to determine, write “value not readily ascertainable” in Block A and provide the following information: (1) the number of units of the security for which the option exists; (2) the strike price; and (3) the expiration date.

Block C: Report the amount of income produced during the reporting period by marking the appropriate “Amount” column. If the amount of income is more than $200, you also need to report the type of income by marking the applicable “Type” column(s). Options normally do not produce income until they have been exercised or sold.

Reporting a Put Option That You Fully Exercised

If you fully exercised a put option, neither the option nor the underlying security will have any reportable value. Report the underlying security if it produced more than $200 in income during the reporting period.

Block A: Provide the name of the underlying security that you sold (e.g., “Widgets Unlimited (WIG)”).

Block B: Report the value of the underlying security by marking the appropriate column, which should be “None (or less than $1,001).”

Block C: Report the amount of income produced during the reporting period by marking the appropriate “Amount” column. If the amount of income is more than $200, you also need to report the type of income by marking the applicable “Type” column(s). In some cases, the underlying security may have produced dividends or interest before you sold it. More often, you will have capital gains as a result of selling the underlying security.

Reporting a Call Option That You Fully Exercised

If you fully exercised a call option, the option will no longer have a value of its own, but the underlying security that you purchased may have reportable value or income. Report the underlying security if its value was more than $1,000 at the end of the reporting period, or if it produced more than $200 in income during the reporting period.

Block A: Provide the name of the underlying security that you purchased (e.g., “Growlster, Inc. (GRWL)”).

Block B: Report the value of the underlying security by marking the appropriate column.

Block C: Report the amount of income produced during the reporting period by marking the appropriate “Amount” column. If the amount of income is more than $200, you also need to report the type of income by marking the applicable “Type” column(s). The exercise of the call option will not itself produce reportable capital gains; however, any subsequent sale of the purchased underlying security may produce capital gains. In addition, the purchased underlying security may have generated reportable dividend or interest income.

Reporting a Put or Call Option That You Resold

Report a put or call option that you resold if the sale produced more than $200 in income during the reporting period.

Block A: Provide the name of the option, which should include the name of the underlying security and the type of option (e.g., “Widgets Unlimited (WIG), put option”).

Block B: Report the value of the option by marking the appropriate column, which should be “None (or less than $1,001).”

Block C: Report the amount of income produced during the reporting period by marking the appropriate “Amount” column. If the amount of income is more than $200, you also need to report the type of income by marking the applicable “Type” column(s). Sales of options ordinarily produce capital gains.

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This guide is not intended to provide investment advice, and you should not rely on statements in this guide when making investment decisions.