How are LEAP options taxed in the U.S?

Leap options are taxed as short-term capital gains. It means long stocks you buy and hold for a year or less are considered short-term capital gains. Short term refers to anything held for under one year.

The main benefit of this is the rate embedded here, which is about half the rate for long-term projects, at 15%. On top of that, any taxes owed on those earnings come off your return due to deferred taxation with regards to those shares until May 1st of next year when they expire (or, more succinctly, absent further trades).

Before calculating how difficult paying these taxes is in expectation, we must speak about what could constitute someone's income if left unrealized in the account.