Accounts & Taxes
Accounts & Taxes
Accounts & Taxes explains how governments and brokers treat options in the two places most of our readers live: the United States and Canada. How option premiums, exercises and assignments are taxed, why index options get special treatment in the US, how brokers decide which options strategies you are approved for, what registered and retirement accounts allow, and who regulates the market. Rules change, so every article says when it was last checked and points to the official source. None of it is tax or legal advice.
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How Options Are Taxed in the US: A Plain-English Guide
How the IRS taxes stock and index options: buyers vs writers, exercise and assignment basis rules, the Section 1256 60/40 rule, Form 6781, wash sales, and straddles.
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How Options Are Taxed in Canada: A Plain-English Guide
How the CRA taxes options: capital vs income account, buyers vs writers, section 49 rules for premiums, ACB adjustments on exercise and assignment, and superficial losses.
Read the explainer →Options Approval Levels: What Brokers Check and Why
Why brokers approve you before you can trade options: FINRA Rule 2360, the Options Disclosure Document, CIRO derivatives account rules in Canada, and how approval tiers work.
Read the explainer →Options in Retirement Accounts: IRAs, TFSAs, and RRSPs
What you can and cannot do with options in an IRA, Roth IRA, TFSA, or RRSP: the IRS borrowing rules, CRA qualified-investment rules, option writing, and the business-income risk.
Read the explainer →How Options Markets Are Regulated in the US and Canada
Who oversees listed options: the SEC, FINRA, OCC and the exchanges in the US; CIRO, the CSA, the Montreal Exchange and CDCC in Canada; plus SIPC and CIPF protection.
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