Trade vs Settlement date?

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Subject Author Date Trade vs Settlement date? KSB 08-01-2009  Re: Trade vs Settlement date? smithff33 08-01-2009  Re: Trade vs Settlement date? Alan 08-02-2009  Re: Trade vs Settlement date? Arthur Kamlet 08-02-2009  Re: Trade vs Settlement date? Alan 08-02-2009
Posted by KSB on August 1, 2009, 4:29 pm Please log in for more thread options >From an IRS perspective, which do I use to calculate tax liability, the trade date or settlement date.? Similarly, for dividends is it the ex-dividend date or date of record? -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by smithff33 on August 1, 2009, 7:21 pm Please log in for more thread options > >From an IRS perspective, which do I use to calculate tax liability, the > > trade date or settlement date.? > Similarly, for dividends is it the ex-dividend date or date of record? Trade date For end-of-the-year dividends, see your 1099-DIV. -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Alan on August 2, 2009, 11:46 am Please log in for more thread options KSB wrote: >> From an IRS perspective, which do I use to calculate tax liability, the > trade date or settlement date.? > Similarly, for dividends is it the ex-dividend date or date of record? Trades: For stocks, bonds and mutual funds you own, the taxable event is the trade date. Dividends: For stocks that you own, the taxable event is the date of distribution or what the corporation refers to as the payable date. The ex-dividend date is set by the exchanges to two business days (cash dividend) before the company announced record date. Anyone buying the stock on or after the ex-dividend date will not get the next dividend distribution. The procedure for a stock dividend is slightly different, but the taxable event is still the payable date. For mutual funds that you own, the taxable event is also the payable date for the dividend. However, unlike stocks, the dividend can be declared payable before year-end but not actually credited to your account until after year-end. -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Arthur Kamlet on August 2, 2009, 4:23 pm Please log in for more thread options >KSB wrote: >>> From an IRS perspective, which do I use to calculate tax liability, the >> trade date or settlement date.? >> Similarly, for dividends is it the ex-dividend date or date of record? >Trades: >For stocks, bonds and mutual funds you own, the taxable event is >the trade date. Although if you close at a loss what began as a sell-to-open you use settlement date. Example: Buy back at a loss shares that you sold short, and use the settlement date for that purchase date. -- ArtKamlet at a o l dot c o m Columbus OH K2PZH -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Posted by Alan on August 2, 2009, 7:08 pm Please log in for more thread options Arthur Kamlet wrote: >> KSB wrote: >>>> From an IRS perspective, which do I use to calculate tax liability, the >>> trade date or settlement date.? >>> Similarly, for dividends is it the ex-dividend date or date of record? >> Trades: >> For stocks, bonds and mutual funds you own, the taxable event is >> the trade date. > > > Although if you close at a loss what began as a sell-to-open > you use settlement date. > > > Example: Buy back at a loss shares that you sold short, and use > the settlement date for that purchase date. I assume you are referring to short sales. It is my understanding that the taxable event (gain or loss) occurs on the day you deliver the asset. For securities, that would be the settlement date whether there is a gain or loss. There is an exception to this rule for worthless securities. For information on how puts and calls (options) are handled, see: http://www.smartmoney.com/personal-finance/taxes/taxes-on-options-151-puts-and-calls-9537/ -- << ------------------------------------------------------- >> << The foregoing was not intended or written to be used, >> << nor can it used, for the purpose of avoiding penalties >> << that may be imposed upon the taxpayer. >> << >> << The Charter and the Guidelines for submitting posts >> << to this newsgroup as well as our anti-spamming policy >> << are at www.asktax.org. >> << Copyright (2007) - All rights reserved. >> << ------------------------------------------------------- >> Similar Threads Posted What is the Trade date in [stock] Rights June 19, 2008, 8:49 am Received settlement for Iridium Securities Litigation settlement. IRA tax implications? November 15, 2009, 1:08 pm Lump settlement from business contract settlement December 13, 2006, 10:38 pm E-Trade Tax Hold, How to Get them to Lift It? 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