I have large holds of (20 count) of options calls at 20 strike whose underlying stock is making comeback through turnaround. It is expiring on Jan 20, but this time I am thinking about holding even longer years. I can keep buying options at more distance time but I also started interested in exercising but not selling the underlying stock and instead holding it. Which means if stock reaches 40$, but i exercise my options at 20$ but instead of selling at current market price, I am holding. Does doing to incur tax obligations? I am assuming not because I haven't materialized any gains before selling the stocks. Thanks.,
They don't tax paper profits. If options are given to you by a company you work for, that's a different story.