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Imagine the following scenario:

  • I purchased 3 LEAP call options on XYZ in 2019 with a strike price of $200.00, expiring over a year from purchase in 2021.
  • I also sold 3 call options on XYZ in 2019 with a strike price of $200.00, expiring one month prior to the LEAPs.

If I buy back the call options at a profit in 2019, can I still sell the LEAPs at a profit in 2020 (over 1 year from the purchase date) and report it as long term rather than short term capital gain in 2020?

  • Your title has the opposite sense of the question body. Yes that scenario will affect the holding period, no you will not get long-term tax rates. – Ben Voigt May 28 at 14:44

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