It's a bit complicated, but under IRS Title 26, most* positions which combine normal stocks and options on that stock which hedge or lower the risk of losses are considered a "straddle" for tax purposes.
https://www.law.cornell.edu/cfr/text/26/1.1092(c)-1:
(a) In general. Section 1092(c) defines a straddle as offsetting positions with respect to personal property. Under section 1092(d)(3)(B)(i)(I), stock is personal property if the stock is part of a straddle that involves an option on that stock or substantially identical stock or securities.
Stocks or options held longer than 12 months may be subject to lower long-term capital gains tax rates. However, if certain option positions are purchased on a later date than the stock, but within the initial 12-month period, this resets the stock's short-term holding period to begin again from zero on the day after the option positions are closed.
So if you hold a stock for 10 months, it goes deep into profit, you open a collar or buy a far out-of-the-money protective put to protect your profits for a few days of volatility, then hold the another 10 months, surprise! The tax man says you didn't make the 12 month goal line, and charges you the higher short-term capital gains tax rate, because you reset the stock's holding period with the options positions.
https://www.law.cornell.edu/cfr/text/26/1.1092(b)-2T:
§ 1.1092(b)-2T Treatment of holding periods and losses with respect to straddle positions (temporary).
(a) Holding period—(1) In general. Except as otherwise provided in this section, the holding period of any position that is part of a straddle shall not begin earlier than the date the taxpayer no longer holds directly or indirectly (through a related person or flowthrough entity) an offsetting position with respect to that position. See § 1.1092(b)-5T relating to definitions.
It gets better, too. If you place the collar legs too close together and flatten out your risk/reward curve too much, that's a "constructive sale" and you are taxed on your stock profits as of the date that you do it. The general thinking on behalf of our evil overlords is that you should not be able to enjoy the lower long-term capital gains tax rates unless you exposed yourself to maximum risk for the maximum period of time. Anything that might protect your profits while the stock ages towards the golden 12 month mark is verboten and knocks you back to square one, or further.
Sorry, you didn't think you were actually going to protect your profits without getting penalized for it, did you? The government doesn't pay you to be resposible and get ahead. The government pays you to take chances and risk financial ruin. How ya like that, smart guy?
*Note that there is some sort of exception for certain covered calls granted in https://www.law.cornell.edu/cfr/text/26/1.1092(c)-2, and way more complications too, but I'm not going to try and parse any of that out, I'm beat.
