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Reporting Company Stock Sales 2018 UPDATES!   
Form W-2 Diagrams   
Tax Changes 2003–2018   
NQSO Basics   
NQSO Withholding   
NQSOs: W-2s & Tax Returns   
ISO Basics   
ISO Withholding   
ISOs: W-2s & Tax Returns   
Restricted Stock Basics   
Restricted Stock Withholding   
Restricted Stock: W-2s & Tax Returns   
Section 83(b)   
ESPP Basics   
ESPP Withholding   
ESPPs: W-2s & Tax Returns   
SARs: W-2s & Tax Returns   
Global Tax Guide   

Annotated diagram of Schedule DTax errors can be costly! Don't draw unwanted attention from the IRS. Our Tax Center explains and illustrates the tax rules for sales of company stock, W-2s, withholding, estimated taxes, AMT, and more.

Tax Center: ESPP Withholding

Are taxes withheld when shares are bought under a tax-qualified employee stock purchase plan? Do FICA taxes apply?
There is no withholding at purchase when shares are bought through a tax-qualified ESPP. However, when you sell the shares, income will be reported on your W-2, and you must report the sales on your tax return.

Most states follow the federal rules and do not require withholding. Pennsylvania, however, does require withholding at purchase (see Pennsylvania Personal Income Tax No. PIT-03-037).

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