SARs

Do you know how stock appreciation rights differ from stock options and restricted stock? How and when are your SARs taxed?

SARs explains a stock grant that is gaining popularity: stock appreciation rights (SARs). The section also explains how SARs differ from other stock awards. This overview page presents selected articles and FAQs from the subtopics in this section. For the full content of a subtopic, click on a link in the upper left.

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

Articles   (Jump to FAQs)

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

Bruce Brumberg
Stock appreciation rights, referred to as SARs, will soon start showing up in equity grants at many 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 

Bruce Brumberg
UPDATED! Stock appreciation rights, referred to as SARs, are garnering interest among companies. Part 2 discusses taxes, IRS concerns, and why companies like SARs.

Reporting Company Stock Sales

The myStockOptions.com Tax Team
UPDATED! Learn how to report your sales of company stock on Schedule D of IRS Form 1040. Our comprehensive guide to Schedule D reporting covers sales of stock from nonqualified stock options, incentive stock options, restricted stock, restricted stock units, employee stock purchase plans, and stock appreciation rights.

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FAQs   (Jump to articles)

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...

UPDATED! What do examples and surveys show about the effects mandatory expensing is having on my stock grants? 

Surveys show that rank-and-file employees and executives are likely to receive fewer stock options, or that grants will be made only at higher levels. In addition, the types of equity grants at companies have changed. A summary of data in surveys from 10 major consulting and research firms shows that...

Why are many companies considering stock appreciation rights (SARs) as an alternative to stock options? 

FAS 123(R) requires the expensing of stock options. This makes accounting for stock options and stock-settled SARs similar, leading some companies...

What are stock appreciation rights (SARs), and how are SARs taxed? 

SARs, or "stock appreciation rights," are rights your company grants you to receive the value of appreciation in shares of its stock from the...

Are stock appreciation rights (SARs) a better deal for me than stock options? 

The personal economic benefits of SARs are...

How do stock appreciation rights (SARs) differ from stock options, restricted stock, and RSUs? 

Stock appreciation rights entitle you to stock (or sometimes cash) that equals the amount...

How do I exercise stock appreciation rights? 

Unlike with stock options, you have no exercise cost to obtain the appreciation spread above...

How does a stock split affect my stock appreciation rights? 

Most stock plans automatically adjust your SARs for the stock split. Your number of SARs will be adjusted...

NEW! What are the biggest mistakes related to stock appreciation rights (SARs) that I can make on my tax return, and how can I avoid them? 

It is easy to make mistakes that lead to paying more tax than you need to, or that may even prompt a review by the IRS. Some of the mishaps are...

W-2 diagram! What will my W-2 show after I exercise stock appreciation rights (SARs)? 

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

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