A dealer equity option is any equity option listed on a qualified board of exchange, that is bought or granted by an options dealer (any person registered with an appropriate national securities exchange as a market maker or specialist in listed options). The dealer should be registered with the qualified board of exchange where the option is listed.
Under U.S. tax law, a dealer equity option qualifies as a 1256 Contract, and benefits from several tax advantages.
References
Dealer equity option Wikipedia(Text) CC BY-SA