§1234B Gains or Losses From Securities Futures Contracts

Summary

Treat gains or losses from selling, trading, or ending a securities futures contract the same way you would treat gains or losses from selling the actual security the contract is based on. The tax type (capital or ordinary) matches how the underlying property is taxed for the taxpayer. This rule does not apply if the contract itself is the kind of property listed in section 1221(a)(1) or (7), or if the income would already be treated as non-capital without this rule. If the amount is a capital gain or loss, it is short-term unless rules in section 1092(b), this rule, or section 1233 say otherwise. A “securities futures contract” means a security future as defined in section 3(a)(55)(A) of the Securities Exchange Act of 1934, as in effect on the date of the enactment of this section. Such contracts are not treated as commodity futures for this title. The Secretary must write rules for how these contracts are taxed, including rules about indexes that become or stop being narrow-based (see section 1256 for dealer rules).