Reverse convertible investors face soaring tax bills under new approach to tax reporting

taxman

The tax bill for holders of certain structured products will balloon if a growing contingent of tax lawyers in the US get their way.

These lawyers argue they are simplifying tax reporting for brokers, but buyers of popular structured products such as reverse convertibles stand to suffer if a proposed tax treatment becomes the norm.

The debate centres on reverse convertibles – perennially popular products that pay investors a periodic coupon and convert into shares of stock at depressed prices if

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