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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.


Learn about stock appreciation rights (commonly abbreviated SARs), which are functionally similar to nonqualified stock options in many ways.

Browse an overview of this section below, or explore the subtopics to the left. See also the stock appreciation rights section of the Tax Center.

Test Your Knowledge Test and improve your knowledge with our Stock Appreciation Rights quiz and its study guide in the answer key.

  Articles   FAQs  

What You Need To Know About Stock Appreciation Rights (SARs): Part 1

Bruce Brumberg
Stock appreciation rights (SARs) are being granted by some companies. To help you understand SARs, Part 1 explains the "appreciation," the role of exercises, and taxes at exercise.

What You Need To Know About Stock Appreciation Rights (SARs): Part 2 This is premium content

Bruce Brumberg
Stock appreciation rights (SARs) are garnering interest among companies. Part 2 discusses taxes, IRS concerns, and why companies like SARs.

How To Report Sales Of Company Stock On Your Tax Return

myStockOptions Editorial Team
If you sold in 2014 any shares that you acquired from equity compensation or an ESPP, you will need to report the sale on your federal tax return. 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.

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

Bruce Brumberg
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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What are stock appreciation rights?

SARs, or stock appreciation rights, are contractual rights that entitle you to receive the appreciation from a corresponding number of company shares after the grant date. Instead of exercising a stock option, you...

What are the top 10 questions I should ask about my stock appreciation rights? This is premium content

You should know the answers to the following questions. Understanding the topics involved will help you make the most of your stock appreciation rights (SARs) and prevent costly mistakes...

Does all the stock option content on this website also apply to stock appreciation rights (SARs)?

Much of the stock option content is relevant to SARs. All the key stock option features...

How are stock appreciation rights taxed? This is premium content

When you you exercise stock appreciation rights, depending on the plan's design and practices, you receive...

What are some year-end strategies for restricted stock, RSUs, and stock options? This is premium content

Decisions in year-end financial and tax planning depend on several factors. In this FAQ, we present several situations and some strategies that many experts suggest. Of course, you should...

UPDATES! What do surveys and examples reveal about the effects of expensing, stock market trends, and other developments on equity compensation? This is premium content

A summary of data in surveys from major consulting and research firms shows that...

When I exercise my stock appreciation rights (SARs), will the amount of tax withheld cover the amount of tax that I must pay when I file my return? This is premium content

Employers usually withhold federal income taxes at the flat rate required for supplemental wages, which is...

Why are some companies considering stock appreciation rights (SARs) as an alternative to stock options? This is premium content

ASC Topic 718, formerly called FAS 123(R), requires the expensing of...

If I exercise stock appreciation rights (SARs), will I need to make estimated tax payments? This is premium content

At a minimum, at the time of your SARs exercise your company will withhold taxes from the proceeds at the required federal withholding rate for supplemental income. However, depending on your income, this minimum withholding may not be enough. If so, you will need to...

W-2 diagram! What will my W-2 show after I exercise stock appreciation rights? This is premium content

The gain from your SARs exercise(s) is totaled on the W-2 with other income in the following boxes...

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