Tax Timing Options on Futures Contracts and the 1981 Economic Recovery Act |
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| Authors: | Raymond Chiang Dennis J. Lasser |
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| Affiliation: | University of Miami, Coral Gables, FL 33124.;SUNY-Binghamton, Binghamton, NY 13901. This paper was written while both authors were at the University of Miami. We are grateful to Anand Vidj for his helpful comments. |
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| Abstract: | This study utilizes foreign currency futures contracts to evaluate the tax timing options created by the 1981 Economic Recovery Act. Our findings suggest that the act had an impact on contracts with less than six months to maturity and that the marginal trader in those contracts is a long-position holder. Similarly, the results suggest that the option of tax year selection for foreign currency futures in valuable. |
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