Dividends I Paid Out On A Stock That I Have Sold Short


D

D.D. Pallmer

How do I report dividends that I paid out on a stock that I
have sold short?
 
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P

Phil Marti

D.D. Pallmer said:
How do I report dividends that I paid out on a stock that I
have sold short?
Depending on the details, as investment interest or added
basis when you cover the short. See "payments in lieu of
dividends" in IRS Pub 550.
 
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B

Bruce E. Cobern

D.D. Pallmer said:
How do I report dividends that I paid out on a stock that I
have sold short?
I am reasonably certain that "short dividends" are reported
as investment interest expense.
 
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R

Rich Carreiro

I am reasonably certain that "short dividends" are reported
as investment interest expense.
According to IRS Pub 550:
* If the short position is open for more than 45 days, you
deduct the "short dividend" as investment interest on
Sched A.
* If the position is open for 45 days or less, you
have to increase your basis in the short position
by the amount of the "short dividend". You can't
deduct it.
 
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D

D.D. Palmer

According to IRS Pub 550:
* If the short position is open for more than 45 days, you
deduct the "short dividend" as investment interest on
Sched A.
* If the position is open for 45 days or less, you
have to increase your basis in the short position
by the amount of the "short dividend". You can't
deduct it.
Does the 45 days mean the total time the position is open,
or does the 45 days mean the from the time I went short
until the time the dividend was paid out by me?
 
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