I am trading stock options. Typically I hold them for few weeks; sell them and wait for the next opportunity to trade them again.
However, now I have been wondering - is it possible somehow to qualify the gain made from stock options for long term capital gain by reopening similar position within certain time period?
For example, one scenario that I am thinking about is that if wash sale rule kicks in then the holding period of stock or stock options I sold (at small loss, but 11 month holding period) and later repurchased (at high gain, but only 1 month holding period) would be added together [http://www.schwab.com/public/schwab/nn/articles/A-Primer-on-Wash-Sales]. Would this really qualify my big-gain position for long term capital gain?
Also this link kinda confirms my suspicion that this is possible:
Also, the holding period of the wash sale securities is added to the holding period of the replacement securities, which increases your odds of qualifying for the favorable tax rate (15% for most folks under the current rules) on long-term capital gains.