15 lines
1.1 KiB
Plaintext
15 lines
1.1 KiB
Plaintext
Chapter 41: Taxes 931
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in any of the strategies. Commission costs and the dissipation of time value premium
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in purchased options will both work against the strategist.
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A tax advisor should be consulted before actually implementing any tax strate
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gy, whether that strategy employs options or not. Tax rules change from time to time.
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It is even possible that a certain strategy is not covered by a written rule, and only a
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tax advisor is qualified to give consultation on how such a strategy might be inter
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preted by the IRS.
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Finally, the options strategist should be careful not to confuse tax strategies with
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his profit-oriented strategies. It is generally a good idea to separate profit strategies
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from tax strategies. That is, if one finds himself in a position that conveniently lends
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itself to tax applications, fine. However, one should not attempt to stay in a position
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too long or to close it out at an illogical time just to take advantage of a tax break. The
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tax consequences of options should never be considered to be more important than
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sound strategy management. |