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On April 4, 2022, Rex thought Elite stock was overvalued. Convinced the price would decline, he borrowed 100 shares of Elite from his broker at
On April 4, 2022, Rex thought Elite stock was overvalued. Convinced the price would decline, he borrowed 100 shares of Elite from his broker at $35 per share. He then immediately sold the shares in a short sale. A few months later, the company posted better-than-expected earnings. On August 1, 2022, Rex purchased 100 shares of Elite stock at $40 per share and then delivered them to his broker to close the short sale. How should this transaction be reported on his tax return
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