Are there any safer options than a keylogger?

How do I report a wash sale between stock and options?

• I sold a stock for loss and bought call options within 30 days following and am not sure how to adjust my cost basis to defer the loss. It actually gets more confusing than that because I bought the stock twice. For example (these are not exact figures but close enough to answer the question): On 5-1-11 I bought 100 shares of company X for $20/share or $2000 total. Company X declined in value and I bought 100 more shares on 9-1-11 for $10/share or $1000 total. I sold 100 shares of company X on 9-20-11 for $12 a share or $1200 total. Then on 10-1-11 I bought 5 call options that expire in Jun 12 of company X. These options have appreciated in value but I'm still holding them in 2012. Now my broker using a FIFO tax system reported the sale on 9-20-11 as a loss of $800. I would've probably done the same thing and held out for a long term gain on the second 100 shares. But now what do I do with the cost basis of the options? The sale is definitely a wash because I bought call options, but do I just lose that write off or do I roll the loss into my options purchase (add $800 to my cost basis of the options)? Also the call options are going to have a gain when I sell them and I don't think my broker calculates wash sales so they will report my cost basis incorrectly and I'm concerned about making adjustments to the 1099. Obviously don't want to get audited, even though all my filings are correct. Is adjusting the cost basis that unusual?

• Answer:

  Stocks are not options so they're not the same security so there is no wash sale.