Copyright © 2013 Knight Sac Media. All rights reserved.http://www.siliconinvestor.com/subject.aspx?subjectid=17266 My first comment is to ALWAYS consult with a qualified and competent tax professional. The intent of the thread is to assist traders and investors with their income tax understanding. I am not a tax expert. I have questions about capital gain and loss reporting that I hope others can help ...http://www.siliconinvestor.com/images/Logo380x132.pnghttp://www.siliconinvestor.com/subject.aspx?subjectid=1726638013210TheNoBoBFile on time, even if you can't pay. The penalty for not filing is 10 times the penalty for not paying on time.http://www.siliconinvestor.com/readmsg.aspx?msgid=288352354/15/2013 12:19:11 AMB.K.MyersWhile it is best to pay the taxes you owe in full and on time, there are times when all you need is to get your next paycheck or wait a few weeks until the money is available. If you filed your taxes on time, the IRS will send you a letter in the mail stating how much you owe plus any additional interest. If you know ...http://www.siliconinvestor.com/readmsg.aspx?msgid=288342144/14/2013 11:20:46 AMCronyNeed advice : Paying taxes late. I owe taxes but won't have the money until May. What is the most efficient way to handle it? I can pay using credit card, but that is 2.5% fee plus the credit card might treat this as a cash advance (another 3%). I am thinking of just filing the return electronically and send them a 10...http://www.siliconinvestor.com/readmsg.aspx?msgid=288341344/14/2013 10:14:59 AMtrend linehttp://www.siliconinvestor.com/readmsg.aspx?msgid=288247284/9/2013 4:46:05 PMArcane Lore ...what will happen to the rest of the $250 loss if there were no purchases after that 1/22/13 purchase Assuming no relevant purchases after 01/22/2013 (at least none before 01/24/2013) and subject to the assumption I made in my previous post, the remaining 500 of the 1000 XIV shares sold on 12/24/2012 are not subje...http://www.siliconinvestor.com/readmsg.aspx?msgid=288237714/9/2013 9:39:19 AMtrend lineThank you for your reply. I did have series of transaction prior to that trade and it is a wash sale. i'll call fidelity and check with them today. i have another question from your reply. you said: "sale rule with $250 of the $500 loss being added to the basis of the 500 shares bought on 01/22/2013" what will happ...http://www.siliconinvestor.com/readmsg.aspx?msgid=288235374/9/2013 5:51:29 AMArcane LoreAssuming that these are the only trades relevant to determining your wash sale exposure, it seems to me that Fidelity got it wrong. The 12/20/2012 sale would be a wash sale if you bought XIV or substantially identical securities to this ETF within the 30 day period before or after 12/20. Since your next purchase was 3...http://www.siliconinvestor.com/readmsg.aspx?msgid=288232944/8/2013 11:03:49 PMtrend linehello i have a wash sale question and would appreciate if someone can help me with this; 12/20/2012 Sold 500 shares of XIV for a loss of $400 12/24/2012 sold 1000 shares of XIV for $500 12/26/2012 Sold 1000 shares of XIV for a loss of $300 01/22/2013 bought 500 shares of XIV the 1099 b from Fidelity shows 12/20 ...http://www.siliconinvestor.com/readmsg.aspx?msgid=288223834/8/2013 1:45:23 PMPatricia Meaneyrotf did you see this one: 3. You file a fraudulent return; keep records indefinitely.http://www.siliconinvestor.com/readmsg.aspx?msgid=288174414/5/2013 10:14:20 AMTheNoBoBhttp://www.siliconinvestor.com/readmsg.aspx?msgid=288161664/4/2013 3:22:45 PMPatricia MeaneyI will be trekking up to my attic to store some of my tax info. While I am there I want to take down and destroy some old returns. I have heard to save returns three years, five years, seven years and ten years. From what year downward can I start shredding old returns?http://www.siliconinvestor.com/readmsg.aspx?msgid=288144844/3/2013 6:36:11 PMElroyThat's interesting and sueful, thanks. I didn't realize selling covered calls on a long term holding would allow you to treat the call premium as a long term gain if it is called.http://www.siliconinvestor.com/readmsg.aspx?msgid=288079583/30/2013 9:09:42 PMTheNoBoBExercised option accounting If the option is exercised, how is the cost of the option accounted for? The premium received from the option is added to the resulting stock transaction. For example, you hold 100 shares of XYZ, bought at $20 (cost basis, $2000). You sell the 21 call for 50 cents ($50). The stock rises...http://www.siliconinvestor.com/readmsg.aspx?msgid=288077803/30/2013 5:27:07 PMElroyIf the option expired worthless, or you closed out the option trade only, the option trade is treated as an individual transaction. If the option is exercised, how is the cost of the option accounted for? Is it a cost basis of the cost of the option, and a sell price of zero (ie, the option cost is a capital loss?)...http://www.siliconinvestor.com/readmsg.aspx?msgid=288068253/29/2013 8:03:55 PMD.Luhttp://www.siliconinvestor.com/readmsg.aspx?msgid=288064183/29/2013 2:53:01 PMTheNoBoBOption positions do not change the cost basis of the underlying position unless the option was exercised (or assigned). If the option expired worthless, or you closed out the option trade only, the option trade is treated as an individual transaction. In your case with covered calls, if the stock was called away yo...http://www.siliconinvestor.com/readmsg.aspx?msgid=288063823/29/2013 2:39:50 PMGlenn Petersenh/t Ron How the Maker of TurboTax Fought Free, Simple Tax Filing by Liz Day ProPublica, March 26, 2013, 5 a.m. This story was co-produced with NPR . Imagine filing your income taxes in five minutes — and for free. You'd open up a pre-filled return, see what the government thinks you owe, make any needed changes ...http://www.siliconinvestor.com/readmsg.aspx?msgid=288023213/27/2013 1:59:23 PMupanddownI have a question about capital loss carryovers. I had a large capital loss in approx 2006-7. I used it until 2010 and had approx 13K left to carryover until 2011. In 2010 I had purchased a house and that caused me to use the last of my taxable capital. I had zero capital gains or losses in 2011. I did not use the $30...http://www.siliconinvestor.com/readmsg.aspx?msgid=288009623/26/2013 6:28:18 PMD.LuI have a few instances where I have made money selling covered calls. In my tax statement from my broker they are listed as short-term transactions NOT reported on Form 1099-B. I'm wondering how to handle these short-term gain transactions on my income tax. Are they listed as ST gains on Form 8949? Or do they just redu...http://www.siliconinvestor.com/readmsg.aspx?msgid=287988633/25/2013 3:43:50 PMFWSI'm from the Qualcomm thread and have a question. I bought stock on margin and my yearly margin expense is more than my interest and dividends. I have been accruing the interest expense through form 5952 with the "disallowed investment interest expense line. However this year I got a margin call and the stock sale ...http://www.siliconinvestor.com/readmsg.aspx?msgid=287944343/22/2013 6:05:52 PMDaYooperThanks Deeno - after reading up on wash sale rules last night I see there is no reason to be concerned. Even if one of my buy/sell lots needs to show a loss (rather than offset the other lot's gains) then that difference just changes the cost basis for my latest buy. So the final result will be the same when I sell t...http://www.siliconinvestor.com/readmsg.aspx?msgid=287933733/22/2013 11:09:00 AMdeenoright, no wash rules on gains. If you didnt specify lots then it was FIFO and you would have one loss where wash rule applies. If you do your own taxes your just going to download the info into turbotax or whatever program you use they will have seperate lots. So if you can get your broker to match up your lots for a...http://www.siliconinvestor.com/readmsg.aspx?msgid=287933143/22/2013 10:51:02 AMDaYooperI bought three equal lots of a stock on Monday and then I sold all three lots Tuesday. I bought at 25.10 and 25.20 and 25.30. Then I sold at 26.50 and 26.00 and 25.15. For tax purposes can I just bunch all three together and simply consider this and report the one total short term capital gain? I'd like to buy agai...http://www.siliconinvestor.com/readmsg.aspx?msgid=287911243/21/2013 12:07:27 PMJim P.Yes: Net gain. If the total of your capital gains is more than the total of your capital losses, the difference is taxable. irs.gov  Figuring Net Gain or Loss The totals for short-term capital gains and losses and the totals for long-term capital gains and losses must be figured separately. Net short-term ...http://www.siliconinvestor.com/readmsg.aspx?msgid=287823013/16/2013 5:53:34 PMElroyI know I've asked this before but have forgotten the answer. Can a long term capital loss offset a short term capital gain? For example, in a given year if I have a $10k long term gain (taxed at 15%), a $200k short term capital gain (taxed as regular income at a fairly high level) and a $10k long term capital loss.......http://www.siliconinvestor.com/readmsg.aspx?msgid=287690023/8/2013 8:24:31 PMElroyI have a 4 year old that I send to a private kindergarten school. Is the cost tax deductible in any way?http://www.siliconinvestor.com/readmsg.aspx?msgid=287271032/14/2013 9:19:47 PMwillcousaI have a client whom this happened to. It took over a year to get his refund and a lot of paperwork and meetings. This kind of fraud dates back to the days of paper filing but is greatly accelerated by efiling. You really have to wonder how big the hole in the system must be. I sincerely hope they catch some of the...http://www.siliconinvestor.com/readmsg.aspx?msgid=286650031/15/2013 11:22:47 AMPeter DierksE-Filing and the Explosion in Tax-Return Fraud Identity-theft cases rocketed to 1.1 million in 2011 from 51,700 in 2008. The IRS has a backlog of 650,000. By JAY STARKMAN Updated January 13, 2013, 7:09 p.m. ET Now that Americans finally know the tax rate they'll be paying, it's time to start thinking about the an...http://www.siliconinvestor.com/readmsg.aspx?msgid=286627981/14/2013 10:01:20 AMwillcousaI would set up a separate account for the project and run everything thru it. There are myriad benefits of doing so.http://www.siliconinvestor.com/readmsg.aspx?msgid=286556741/10/2013 1:07:31 PMElroyQuestion on tax implications of accepting a small business payment in a personal account. I have the opportunity to set up a company for an investor. He is going to pay $20,000 to me as non-refundable upfront money to defer startup costs of approximately $35,000. However, when he pays the $20,000 there will be no co...http://www.siliconinvestor.com/readmsg.aspx?msgid=286495901/7/2013 9:56:52 PMJim P. First off I agree with you on no likely change. Such a waste. It is such a great opportunity to improve the tax code. I think our economy will survive the cliff as there is not enough time to do it right any way. Doomed to failure and kick the can down the road is the worst outcome. Even though I will be hurt...http://www.siliconinvestor.com/readmsg.aspx?msgid=2860999612/17/2012 1:17:42 PMwillcousaA better negotiating position is likely on the issue you pose. But what we investors need is a better economy. One should look at how JFK tackled a bad economy when he came into office. A lot of time has been wasted now to no great accomplishment and there is no prospect that things will change.http://www.siliconinvestor.com/readmsg.aspx?msgid=2860978512/17/2012 12:07:06 PMdeenoot "I have been thinking for a while that letting the cliff happen leaves Obama in a better position to negotiate" Nope, he has to have the debt ceiling raised. He has no choice other than circumventing congress, so a complete stonewall from the WH leads to more cuts demanded by congress. Money that he wants to spe...http://www.siliconinvestor.com/readmsg.aspx?msgid=2860226512/13/2012 3:57:34 PMJim P.I have been thinking for a while that letting the cliff happen leaves Obama in a better position to negotiate. There is little incentive to have an agreement happen before the end of the year IMO. After Jan 1 instead of negotiating tax increases Obama will be negotiating tax cuts as the new baseline will be the new...http://www.siliconinvestor.com/readmsg.aspx?msgid=2860213712/13/2012 3:13:30 PMwillcousaI am pessimistic that any agreement will be reached. One side does not seem to mind if taxes go up on everyone as they will blame the other and probably make it stick. But I am not sure that anyone has identified all of the increased taxes and other costs (like healthcare increases) that will occur in 2013 and 2014.http://www.siliconinvestor.com/readmsg.aspx?msgid=2860209712/13/2012 2:56:33 PMElroyAnyone have a best guess or prediction what capital gains tax will be for the lowest tax bracket after lawmakers finally reach an agreement. I think if it's a small amount (to be in the lowest tax bracket) it would be zero. If you have $2,000 of capital gains on year and nothing else, I think it's regular income so ...http://www.siliconinvestor.com/readmsg.aspx?msgid=2859895812/12/2012 10:25:19 AMDaYooperThanks for your thoughts Elroy. Yes the tax in 2012 will be 15 percent. Pains me to think of sending that money to them. Anyone have a best guess or prediction what capital gains tax will be for the lowest tax bracket after lawmakers finally reach an agreement. I realize it's speculation but I'd like to get hear so...http://www.siliconinvestor.com/readmsg.aspx?msgid=2859891912/12/2012 10:13:01 AMElroy I believe the stocks will continue to do fine so I'm only trying to figure out the tax consequences of selling now versus 2014. Sell in 2012 and you pay 15% tax on the capital gain. Sell in 2014 and you'll probably pay 20% tax on the capital gain (depending on how the fiscal cliff tax thing works out, but 20% tax ...http://www.siliconinvestor.com/readmsg.aspx?msgid=2859816912/11/2012 10:00:44 PMDaYooperI have a couple stocks I've owned more than ten years. I will be retiring within the next year. I want to sell these growth stocks with significant capital gains and move the money into dividend paying stocks. Should I wait another 13 months into 2014 when I will have no job related income? I believe the stocks wil...http://www.siliconinvestor.com/readmsg.aspx?msgid=2859814112/11/2012 9:42:46 PMdeeno"To offset ST gains? Since I am not in a high tax bracket, it would seem the ST losses might be more valuable in offsetting gains in 2013." sure, your rate for ST gains vs next year bracket is probably going to end up about the same, so why not use them now. "Your calculation is based on taking gains now to avoid h...http://www.siliconinvestor.com/readmsg.aspx?msgid=2859723912/11/2012 1:32:13 PMD.Lu"ST gains are taxed at ordinary income rates. so use your tax losses this year to offset." To offset ST gains? Since I am not in a high tax bracket, it would seem the ST losses might be more valuable in offsetting gains in 2013. "Take your long term gains this year, and if you really like the stock just buy it back...http://www.siliconinvestor.com/readmsg.aspx?msgid=2859720012/11/2012 1:17:03 PMdeenoST gains are taxed at ordinary income rates. so use your tax losses this year to offset. Take your long term gains this year, and if you really like the stock just buy it back as there is no wash rule for taking gains. Check with a real accountant for your particular situation.http://www.siliconinvestor.com/readmsg.aspx?msgid=2859686912/11/2012 11:28:54 AMD.LuI need some elementary tax advice. Capital gains tax liability (stocks) for 2012 is about $16K in short term gains this year. Have considerable unrealized ST and LT gains, and a few unrealized losses in each category. Gross income is under $100,000, mostly from earned income. In this instance does it make any differenc...http://www.siliconinvestor.com/readmsg.aspx?msgid=2859667412/11/2012 10:19:40 AMwillcousahttp://www.siliconinvestor.com/readmsg.aspx?msgid=2859491112/10/2012 11:07:46 AMElroyCheck with your professional tax adviser, I don't have a professional tax advisor. if its a REIT and its DECLARED in December but paid in January then its that year's (2012) income and if not a REIT its income in year paid (2013). Hmmm, interesting. I just take the dividend total from my year end brokerage state...http://www.siliconinvestor.com/readmsg.aspx?msgid=2859177512/7/2012 8:45:26 PMLTBHCheck with your professional tax adviser, but my understanding is typically if its a REIT and its DECLARED in December but paid in January then its that year's (2012) income and if not a REIT its income in year paid (2013). Luck LTBHhttp://www.siliconinvestor.com/readmsg.aspx?msgid=2859058512/7/2012 11:34:07 AMElroyIf a stock goes ex-dividend in December but the dividend isn't paid until January, is that dividend 2012 income or 2013 income?http://www.siliconinvestor.com/readmsg.aspx?msgid=2859020512/7/2012 9:08:31 AMNOWsold some gold coins last year: I cant see how to enter them into Turbotax as a collectable THe program walks me through that, but I am not sure it is properly calculating the 28% rate. Anyone?http://www.siliconinvestor.com/readmsg.aspx?msgid=2847075210/13/2012 2:02:56 AMGlenn PetersenA Strategy of Tattletales at the I.R.S. By VICTOR FLEISCHER DealBook New York Times September 20, 2012, 12:04 pm No one likes a tattletale. But tax whistle-blowers sure are getting compensated for the animosity they evoke. Bradley Birkenfeld, a former UBS banker, was awarded $104 million for bringing information...http://www.siliconinvestor.com/readmsg.aspx?msgid=284220059/20/2012 12:26:42 PMElroyI might have asked this before, but I'm asking again. I have two stocks which incur annual ADR fees - GRVY and SIMO. Am I able to add these fees to my cost position when selling the stock and calculating capital gains?http://www.siliconinvestor.com/readmsg.aspx?msgid=283658578/27/2012 11:55:07 PM