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Restricted Stock

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.


Restricted Stock

Restricted stock, RSUs, and performance shares have become prominent forms of stock grant. Browse an overview of this section below, or explore the subtopics to the left.

In addition to the main areas about basic and advanced topics in all these types of grants, see the special subsections that are exclusively about restricted stock units and performance shares.

Selected Articles

Taxes Advanced

Restricted Stock & RSUs: 10 Mistakes To Avoid On Your Tax Return This is premium content

UPDATES! This article explains common errors to avoid when your tax return involves restricted stock/RSUs and offers related helpful tips.
Taxes Advanced

Form 8949 and Sch. D diagrams! How To Report Sales Of Company Stock On Your Tax Return

If you sold in 2016 any shares that you acquired from equity compensation or an ESPP, you will need to report the sale on the federal tax return that you file in 2017. Learn here what you must know to avoid expensive mistakes and unwanted IRS attention. Our annotated diagrams of Form 8949 and Schedule D can help you make sense of the reporting rules.
Taxes Advanced

VIDEO! Tax-Return Forms And Reporting Rules For Stock Sales

Learn how to prevent costly tax return mistakes with this animated presentation on IRS Form 1099-B, IRS Form 8949, and Schedule D.
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Taxes

Restricted Stock Units Made Simple (Part 2): Taxation This is premium content

The taxation of RSUs generally resembles that of restricted stock but carries some important differences.
Basics

The Great Benefits Of Restricted Stock

Podcast included! While restricted stock, restricted stock units, and performance shares don't offer the same upside as stock options, they have benefits you will appreciate once you understand their features.
Taxes Advanced

How To Avoid Paying Too Much Tax: Understanding Form 1099-B And Form 8949 For Reporting Stock Sales On Your Tax Return This is premium content

UPDATES! The stock-sale information provided by brokers on IRS Form 1099-B has changed. Cost-basis reporting, both for your broker on Form 1099-B and for you on your tax return, is now more complex, confusing, and vulnerable to errors. This article explains the crucial facts you must know to avoid overpaying tax or attracting unwanted IRS attention.
This is simply a selection of the many articles in this section.
Use the navigation to the left to explore all of the categories in this section.

Selected FAQs

Taxes Advanced

What are the biggest mistakes with restricted stock or RSUs that I can make on my tax return, and how can I avoid them? This is premium content

It is all too easy to make costly tax-return errors that attract unwanted IRS attention. Learn how to prevent mistakes...
Taxes Advanced

What are some major issues to be aware of when reporting stock sales on my tax return? Why have these issues arisen?

Major changes have occurred in the tax reporting for stock sales during the past few years, making accurate tax-return reporting more complex and difficult...
Taxes Advanced

In the cost basis I use to report sales of company stock on my tax return, what part comprises the W-2 income from stock compensation or an ESPP? This is premium content

When your W-2 income is added to the price you paid for the stock, this is your cost basis on your tax return. The table below presents the compensation portion of your tax basis for all types of stock grants and ESPPs...
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Taxes Advanced

How have IRS Form 1099-B and cost-basis reporting changed for sales of stock acquired from my stock options, restricted stock, or ESPP? What do I need to do differently because of the changes?

If you sold shares during the calendar year, your brokerage firm will issue IRS Form 1099-B by mid-February of the following year. This is an important document that you must have to complete your tax return for the year of sale...
Taxes Advanced

What if the wrong cost basis is reported on my 1099-B? How do I report the right cost basis on Form 8949 of my tax return? This is premium content

From our interpretation of the forms and their instructions, myStockOptions.com recommends the following reporting steps to avoid overpaying taxes...
Taxes Advanced

Form 8949 and Sch. D diagrams How do I report a sale of restricted stock on my federal income-tax return? This is premium content

You need to complete Form 8949 and Schedule D for the year when you sold your stock and file them with your Form 1040 federal income-tax return. You do this even if...
Taxes Advanced

Form 8949 and Sch. D diagrams In the tax-return reporting for restricted stock, do I need to report shares that I sold for taxes or that my company used for tax withholding? This is premium content

You should definitely report a sale for taxes at vesting if you received a 1099-B that shows the proceeds. The IRS will...
Taxes Advanced

Form 8949 and Sch. D diagrams When I hold restricted stock after it vests and later have capital gains on the sale, will I get any credit for the income tax I paid at vesting? This is premium content

The vesting and the sale are separate transactions. First the stock's value at vesting is taxed, unless...
Restricted Stock Units

What are the top 10 questions I should ask about my grant of restricted stock or RSUs?

You should know the answers to the following questions. Understanding the topics involved will help you make the most of your restricted stock/RSU grant and prevent costly mistakes...
Restricted Stock Units

What is the difference between restricted stock and restricted stock units (RSUs)? This is premium content

While they are siblings, they have important differences, as explained below and as shown by the chart. The traits of restricted stock units include the following...
Basics

What are the top 10 questions I should ask about my grant of restricted stock or RSUs?

You should know the answers to the following questions. Understanding the topics involved will help you make the most of your restricted stock/RSU grant and prevent costly mistakes...
This is simply a selection of the many FAQs in this section.
Use the navigation to the left to explore all of the categories in this section.