Took My 1st Intentional Tax Write-off

Unless there is a catastrophic drop in the market in the next 2 weeks I’ll be taking huge profits into next year. In preparation for April 15th, in the next 2 weeks I’ll be making some moves to ease the tax blow. Some of my moves will be simple moves and some might be more complicated.

Today’s move is pretty simple. On 11/27 I sold a 10 contract $64 Naked Call with Micron (MU). Right before expiration the position went In-the-Money. I decided to not cover the Call with the buying of the 1000 shares. When the stock closes In-the-Money, and you’re not covered, your broker will deliver the stock and you will be Short 1000 shares of that stock. This is what I did with my Micron Call. I have been Short the shares ever since in the hopes that the stock will go down. It never did! In fact the stock went higher. It went all the way up to $74, $10 above where I Shorted the stock. The stock has been slowly moving down, and today the stock is down $1.50 to $70.

With the stock down I decided to get out of the position and take a nice size tax write-off at the same time. When you are in desperate need of tax write-offs this was an easy decision. Getting out of this position gives me a $6000 write-off. I do not like taking a loss like this but getting the write-off eases the tax blow.

Intentional Tax Write-off

11/27/20 – Short 1000 Shares MU @ $64.00

12/22/20 – Buy 1000 Shares of MU @ $70.00

Loss -$6000

I could have taken this position into next year and see how it would work out, but I think this is the better move.

The last 2 weeks of the year you will see more of this from me. With me working on write-offs I do not think you will see anymore winning weeks. However, the 1st 2 weeks of January should be very big.

I’m talking to my account and working on a big tax write-off with Peloton. This one I’ll be writing a full report.

I feel my tax burden easing! lol

Successful trading,

Steve

The Options Coach