> You could simply declare this income as regular income and forego the tax-advantage of the capital gains rate. No, you can't do that. It's reported by the i

> You could simply declare this income as regular income and forego the tax-advantage of the capital gains rate. No, you can't do that. It's reported by the investment broker as investment income, and you must declare it as investment income and provide the specific details /whether or not there is any tax advantage/. > There is no penalty. Prove it. Show me where the IRS says that you can submit investment income as regular income when it was already submitted on the backend by a broker as investment income and how that will not result in a penalty for misfiling. > more tedious than complicated This tells me you've never done it. Depending on your broker (and sometimes you don't get to choose, for instance as part of an ESPP or for RSUs) they may not provide it to you in a nice clean way and it's rather annoying to determine, for instance, the correct cost basis. At some point "tedious" and "complicated" are the same thing. > complete compliance with the law. Actual tax attorneys barely know what qualifies as "complete compliance from the law". You should probably simply refrain from giving legal advice about taxes if you are not in fact a tax attorney and the reader is not in fact your client.