Is american call option exercise taxable event?

Question

Since best to my knowledge the premium paid for the call option has to be added to the strike price to calculate the post exercise stock's cost basis, I assume that the answer is "No, exercise is not taxable event".

However, I can't find article (or question on this stackexchange) that clearly answers this part with a simple "Yes" or "No" answer.

If it is not taxable event, then it seems that it may often be a good idea to exercise american call options, because doing so one can roll unrealized short term cap gains from call option into stock that in a year could qualify for favorable long term cap gains.

Answer 1

From page 58 of IRS Publication 550:

If you exercise a call, add its cost to the basis of the stock you bought. If you exercise a put, reduce your amount realized on the sale of the underlying stock by the cost of the put when figuring your gain or loss. Any gain or loss on the sale of the underlying stock is long term or short term depending on your holding period for the underlying stock.

An example from Investopedia:

When call options are exercised, the premium paid for the option is included in the cost basis of the stock purchase. Take for example an investor who buys a call option for Company ABC with a $20 strike price and June 2020 expiry. The investor buys the option for $1, or $100 total as each contract represents 100 shares. The stock trades at $22 upon expiry and the investor exercises the option. The cost basis for the entire purchase is $2,100. That's $20 x 100 shares, plus the $100 premium, or $2,100.

Let's say it is August 2020 and Company ABC now trades at $28 per share. The investor decides to sell their position. A taxable short-term capital gain of $700 is realized. That's $2,800 in proceeds minus the $2,100 cost basis, or $700.