How much tax do I owe on futures and broad-based index option gains under the Section 1256 60/40 rule?

How this is calculated

• Section 1256 of the Internal Revenue Code applies a mandatory 60/40 split to regulated futures contracts, broad-based stock index options (like SPX, NDX, or RUT options), and certain other instruments: 60% of the gain or loss is treated as long-term, and 40% as short-term, no matter how long the position was actually held.
• Blended tax rate = (60% × your long-term capital gains rate) + (40% × your ordinary/short-term rate). Estimated tax owed = net gain × blended rate.
• For comparison, this tool also shows what you'd owe if the entire gain were taxed at your short-term/ordinary rate, which is how single-stock options and regular stock trading gains are generally treated.
• Open Section 1256 positions are marked to market on the last business day of the year, meaning unrealized gains or losses on positions you're still holding are included in that year's tax calculation, not just closed trades.
• Single-stock options do not qualify for Section 1256 treatment. This applies specifically to regulated futures, broad-based index options, and certain foreign currency contracts.
• This tool does not know your actual bracket, state taxes, wash sale adjustments, or trader tax status. It applies the rates you enter to the 60/40 split only.