Resources: Newsletter Archives
REPORT OF CONTENT ADDED,
UPDATED, REVISED, OR EXPANDED
January, February, and March 2008
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1st QUARTER 2008: CONTENT ADDED, UPDATED, REVISED, OR EXPANDED |
 TAX CENTER: Tax return tips and examples of IRS Form W-2 and Schedule D for reporting company stock sales
CONTENT TOPICS: Articles and FAQs
GLOBAL TAX GUIDE: Changes of tax law in France, Germany, and the UK
GLOSSARY: New terms include capital loss whipsaw, refundable credit, rule of 75, and more
ASK THE EXPERTS: Where does stock grant income received in 2007 appear on IRS Form W-2?
MSO Pro is our membership level for financial and wealth advisors. Content with the  symbol requires Premium or Pro Membership at myStockOptions.com.
The first quarter of 2008 kept our editorial team busy with many updates and additions to the content of myStockOptions.com. By early January, we had updated all of our content for relevant changes in tax law that became effective on January 1, 2008.
Podcasts: We're All Ears
 We are adding podcasts to our website, giving you yet another way to learn about equity compensation. These succinct, professionally produced recordings are available both by streaming media you can listen to on your computer and as MP3 files you can download and save to an MP3 player. Our first podcasts are on the basics of stock options and restricted stock. Others will follow on many topics, both basic and advanced.
April 15 Is Nigh, But It's Not Too Late To Prevent Tax Mistakes
As the tax-return deadline looms, our articles and FAQs on W-2s and tax returns are more valuable than ever for preventing mistakes in the reporting for stock options, restricted stock and RSUs, performance shares, stock appreciation rights, and employee stock purchase plans. You will find all of this content in the Tax Center, where the special section Reporting Company Stock Sales has annotated examples that show you how to report sales of stock on Schedule D of Form 1040.
After you have filed your tax return, other content can help you throughout the rest of the year. See our articles and FAQs on the full range of topics in financial planning for stock compensation: retirement, college funding, life events, job events, diversification, estate planning, and much more.
Explore Our Award-Winning Resources
Below is a selection of content we added or revised during the first quarter of 2008. Click on any of the section headings: the link will take you to the relevant topic area of the website. To view the content of any title with the logo, you must be a Premium or Pro Member of myStockOptions.com.
Please contact us at 617-734-1979 or sales@mystockoptions.com if you would like to receive more information on licensing our content and/or tools, on our custom websites for companies, and on our bulk Premium Memberships to our public site. Meanwhile, please consider the benefits of an individual subscription, and see who becomes a Premium Member of myStockOptions.com.
—Bruce Brumberg, Editor-in-Chief
Tax Center: Stock Options & SARs
Avoid Costly Tax Return Mistakes And Maximize Your Profits: What Optionholders Need To Know FREE!
NQSOs: Tax Return Tips And Traps
ISOs: Tax Return Tips And Traps
What are the biggest mistakes related to stock options I can make on my tax return, and how can I avoid them?
When I file an extension to complete my tax return after the IRS deadline, are there any mistakes I should avoid that involve stock grant income?
W-2 diagram! What will my W-2 show after I exercise nonqualified stock options?
W-2 diagram! What will my W-2 show after I exercise stock appreciation rights?
Schedule D diagrams! How do I report sales of NQSO stock?
Schedule D diagrams! How do I report sales of ISO stock?
Schedule D diagrams! How do I report sales of SAR stock?
What is the alternative minimum tax (AMT)? What is the latest news about AMT reform in Congress? FREE!
In general, how does the alternative minimum tax (AMT) calculation work? FREE!
Do I get a tax credit if I paid AMT when I exercised an ISO? How does it work, and did the tax law of December 2006 change this?
Refundable AMT Credit (Part 1): Different Rules For Old Unused Credit FREE!
Refundable AMT Credit (Part 2): The Calculation FREE!
I acquired stock from option exercises and restricted stock vesting a few years ago. When I sell the stock, how do I rediscover the cost basis for Schedule D of my tax return?
Stock Option Fundamentals (Part 5): Incentive Stock Option Taxation & Alternative Minimum Tax
Are there any strategies for paying estimated taxes on income from stock options and restricted stock?
Will I receive any mandatory information statement from my company about exercises, purchases, and sales related to my stock options and/or employee stock purchase plan?
Does the American Jobs Creation Act, particularly Section 409A on deferred compensation, affect my stock grants? FREE!
My new company withheld Social Security tax from my wages even though I "maxed out" on these taxes this year from my stock option exercise and restricted stock vesting at my prior employer. Can I get a refund or a credit on my tax return?
Does the lower long-term capital gains rate apply to stock sales on or after May 6, 2003, even though the option was granted, vested, or exercised before that date?
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?
Will the amount of tax withheld at NQSO exercise cover the amount of tax that I am required to pay when I file my return?
Tax Center: Restricted Stock, RSUs, & Performance Shares
W-2 diagram! What is included in my W-2 in connection with a restricted stock grant?
W-2 diagram! What is included in my W-2 in connection with a grant of restricted stock units?
W-2 diagram! What will appear on my W-2 in connection with a grant of performance shares?
Schedule D diagrams! How do I report restricted stock and RSU sales?
Schedule D diagram! How do I report sales of performance shares?
When I file an extension to complete my tax return after the IRS deadline, are there any mistakes I should avoid that involve stock grant income?
Are there any strategies for paying estimated taxes on income from stock options and restricted stock?
Does the American Jobs Creation Act, particularly Section 409A on deferred compensation, affect my stock grants? FREE!
My new company withheld Social Security tax from my wages even though I "maxed out" on these taxes this year from my stock option exercise and restricted stock vesting at my prior employer. Can I get a refund or a credit on my tax return?
Will the amount of tax withheld at my restricted stock vesting cover the amount of tax that I am required to pay when I file my return?
Tax Center: ESPPs
Schedule D diagram! How do I report sales of ESPP stock?
Will I receive any mandatory information statement from my company about exercises, purchases, and sales related to my stock options and/or employee stock purchase plan?
Tax Center: Tax Cuts 2003–2008
How does stock compensation affect my tax rebate under the Economic Stimulus Act? FREE!
Refundable AMT Credit (Part 1): Different Rules For Old Unused Credit FREE!
Refundable AMT Credit (Part 2): The Calculation FREE!
Did the tax laws of May 2003 and May and December 2006 change the taxation of incentive stock options? Did it, for example, remove the exercise spread from the calculation of alternative minimum tax?
Are there any stock-option strategies for using my capital-loss carry-forwards?
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Basics: Exercise
How do I use stock that I own to exercise an option in a stock swap? What is the tax treatment?
Basics: Valuation & Expensing
What are the main models for stock option valuation, and how do they differ?
What does it mean when someone says that employee stock options have both face (or intrinsic) value and time value?
How do I value options and stock in a private company?
Basics: Underwater Options
Stomach Volatility In Your Company's Stock Without Losing Your Mind FREE!
What approaches do companies apply to underwater stock options?
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NQSOs: Taxes
Are the tax rules and withholding for NQSOs different if I am an independent contractor, consultant, or outside director and not an employee?
NQSOs: Taxes Advanced
Avoid Costly Tax Return Mistakes And Maximize Your Profits: What Optionholders Need To Know FREE!
How do I use stock that I own to exercise an option in a stock swap? What is the tax treatment?
If I exercise NQSOs, will I need to make estimated tax payments?
Are there any stock-option strategies for using my capital-loss carry-forwards?
My new company withheld Social Security tax from my wages even though I "maxed out" on these taxes this year from my stock option exercise and restricted stock vesting at my prior employer. Can I get a refund or a credit on my tax return?
What happens if I live in state A when my stock options are granted, state B when I perform some of my services, state C when I exercise the options, and state D when I sell the shares?
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ISOs: Limits
Can an ISO be divided in a divorce?
How are ISOs usually handled in divorce?
ISOs: Taxes
If I plan to sell my ISO stock before the end of the required holding periods (i.e., a disqualifying disposition), is there any tax advantage to receiving ISOs instead of NQSOs?
ISOs: Taxes Advanced
Avoid Costly Tax Return Mistakes And Maximize Your Profits: What Optionholders Need To Know FREE!
How do I use stock that I own to exercise an option in a stock swap? What is the tax treatment?
What happens if I live in state A when my stock options are granted, state B when I perform some of my services, state C when I exercise the options, and state D when I sell the shares?
ISOs: AMT
What is the alternative minimum tax (AMT)? What is the latest news about AMT reform in Congress? FREE!
I have large unused AMT credits. Do the tax laws of December 2006 and December 2007 help me use them quicker?
ISOs: AMT Advanced
Refundable AMT Credit (Part 1): Different Rules For Old Unused Credit FREE!
Refundable AMT Credit (Part 2): The Calculation FREE!
After I have paid AMT for my ISO exercise and hold, what are some mistakes that I must avoid on my tax return?
If I exercise ISOs and hold the stock (triggering AMT for the spread) or sell the stock in a disqualifying disposition, will I need to make estimated tax payments?
Are qualified dividends included in the AMT calculation?
I know that my ISO exercises will trigger the AMT for me this year or next. What planning strategies should I use that are related to other tax payments and income?
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Employee Stock Purchase Plans (ESPPs) |
Employee Stock Purchase Plans: Basics
What is the eligible compensation that can be used for calculating the money that is available for the stock purchase? FREE!
Employee Stock Purchase Plans: Rules
What is an "offering period" or "enrollment period"?
Can I roll unused ESPP funds into the next purchase period?
Employee Stock Purchase Plans: Taxes Advanced
Avoid Costly Tax Return Mistakes And Maximize Your Profits: What Optionholders Need To Know FREE!
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Restricted Stock & Restricted Stock Units |
Restricted Stock Units
How does the taxation of restricted stock and restricted stock units differ?
Performance Shares
What is the difference between restricted stock and performance shares or units?
What are the features of long-term performance awards, such as performance shares and units? What do surveys say the most commonly used metrics are?
Restricted Stock: Taxes Advanced
Avoid Costly Tax Return Mistakes And Maximize Your Profits: What Optionholders Need To Know FREE!
Will my income from restricted stock vesting be netted against my short-term capital losses from this year (or those that were carried forward from last year)?
My new company withheld Social Security tax from my wages even though I "maxed out" on these taxes this year from my stock option exercise and restricted stock vesting at my prior employer. Can I get a refund or a credit on my tax return?
When my restricted stock vests, will I need to make estimated tax payments?
What happens if I live in state A when my restricted stock is granted, in state B when part of it vests, in state C when the rest of it vests, and in state D when I sell my shares?
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Stock Appreciation Rights (SARs) |
Stock Appreciation Rights: Taxes
What are stock appreciation rights (SARs), and how are SARs taxed?
If I exercise stock appreciation rights (SARs), will I need to make estimated tax payments?
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 Advisors, Have You Heard About MSO Pro?
Made just for you, with tools to track and model grants for multiple clients, and proactive communications to build relationships. Click here for more information.
Financial Planning: Strategies
Stockbrokers' Secrets (Part 6): What I Tell My Best Clients About Retirement Planning With Stock Compensation
Financial Planning: Advanced Strategies
How To Develop A Stock Option Exercise Strategy To Reach Your Financial Goals (Part 1)
How To Develop A Stock Option Exercise Strategy To Reach Your Financial Goals (Part 2): Understand Risk Versus Return
Are there any stock-option strategies for using my capital-loss carry-forwards?
I know that my ISO exercises will trigger the AMT for me this year or next. What planning strategies should I use that are related to other tax payments and income?
Financial Planning: High Net Worth
Will my company be able to take a tax deduction for the value of my restricted stock, restricted stock units, performance shares, or stock options if my compensation already exceeds $1 million?
Financial Planning: Diversification
Stockbrokers' Secrets (Part 6): What I Tell My Best Clients About Retirement Planning With Stock Compensation
Financial Planning: Estate Planning
How would my stock options be taxed and valued for estate tax purposes upon my death?
Financial Planning: Gifts
What is the tax treatment for gifts of company stock? FREE!
Financial Planning: Dividends
Are qualified dividends included in the AMT calculation?
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Job Events: Hiring
What does it mean when someone says that employee stock options have both face (or intrinsic) value and time value?
Job Events: Consultants & Contractors
Can consultants or independent contractors be granted stock options or company stock? How common is this practice? FREE!
What are the special issues with options granted to consultants that I need to consider in negotiating my agreement with the company?
Do the terms in option grant agreements to consultants differ from the terms in employee grant agreements?
Are the tax rules and withholding for NQSOs different if I am an independent contractor, consultant, or outside director and not an employee?
Are the tax rules for restricted stock different if I am an independent contractor, a consultant, or an outside director and not an employee?
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Life Events: College Funding
Funding Your Child's College Education With Stock Options And Other Stock Grants (Part 1)
Funding Your Child's College Education With Stock Options And Other Stock Grants (Part 2)
Funding Your Child's College Education With Stock Options And Other Stock Grants (Part 3)
Life Events: Retirement
Stockbrokers' Secrets (Part 6): What I Tell My Best Clients About Retirement Planning With Stock Compensation
Life Events: Retirement Plans
How do stock options, ESPPs, and restricted stock differ from the company stock fund or contribution offered under my 401(k) plan?
How does my grant of stock options or restricted stock affect my other employee benefits, such as 401(k) contributions?
How do stock grants affect the income limits for contributing to a Roth IRA?
Can I sell my company stock to my IRA for cash or contribute my company stock to it?
Can options be granted to my IRA instead of to me?
Life Events: Divorce
How are stock options and restricted stock valued in divorce?
How are ISOs usually handled in divorce?
Can an ISO be divided in a divorce?
After stock options are transferred to my former spouse in divorce, who pays the taxes at exercise? How does my company withhold and report the taxes?
Life Events: Death Taxes
How would my stock options be taxed and valued for estate tax purposes upon my death?
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M&A Impact
What happens to my unvested stock options if my company is acquired?
M&A: Taxes
What's the tax treatment of my stock options in an acquisition?
Does the accelerated vesting of my stock options, restricted stock, and/or performance shares in a change of control have any tax impact on me, such as for ISOs and golden parachute payments?
One year after the acquisition, under the deal's terms I was granted additional shares in an earnout for my company's meeting of performance targets. How are these additional shares taxed?
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 Insider Trading Prevention And Education:
Think Twice Video And Intranet Series
Request free previews at http://www.insidertradingvideos.com
With insider trading cases in the news, now is a good time for insider trading education and focusing on your compliance program. The dramatic Think Twice video series will teach, entertain, and jolt your employees and executives about insider trading and securities fraud. Used by over 1,000 companies and developed with input from the SEC Enforcement Division, these powerful videos with memorable story-lines will drive home key points on
- what insider trading is
- the penalties and consequences
- how the SEC discovers illegal activity
- what happens if illegal tipping or trading is suspected
- how SEC investigations are conducted
For more information on the Think Twice video series, and a free white paper on insider trading prevention and education, see http://www.insidertradingvideos.com. Both VHS and DVD formats are available. Qualified corporate buyers, including pre-IPO companies, can request free previews. Intranet licensing is available. |
SEC Law: Insider Trading
Does it matter whether the person who violates the insider-trading laws lives outside the US?
SEC Law: Rule 144
How and when is Form 144 filed?
Do the holding-period requirements under Rule 144 always apply to sales of company stock by affiliates and regular employees?
Does the period I held unexercised options count towards the holding period for resales of unregistered securities under Rule 144?
If I am no longer an officer or director of a public company, do I still need to meet the requirements of Rule 144 to sell my company stock?
What are the requirements that affiliates (i.e., executives or directors) must follow to sell their stock to the public under Rule 144?
For Rule 144 resale requirements, what is the difference between (1) restricted securities I own as a company officer or director that are not registered with the SEC and (2) company shares I bought on the open market?
Do I still file Form 144 even though I have held the restricted securities long enough?
What regulations govern the sales activities of brokers under Rule 144?
Do Rule 144 and Section 16 apply to gifts of company stock by senior executives or directors?
How do I have the legend removed from my restricted securities?
How soon after an IPO can I sell my stock under Rule 144?
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Pre-IPO: Basics
How do I value options and stock in a private company?
Pre-IPO: Going Public
Stomach Volatility In Your Company's Stock Without Losing Your Mind FREE!
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GLOBAL TAX GUIDE |
UPDATED OR EXPANDED
France (new social security contribution)
Germany (major change in capital gains tax)
United Kingdom (major change in capital gains tax)
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NEW!
capital loss whipsaw
measurement date
performance cycle
refundable credit
release date
rule of 75
shared performance stock award
target award
UPDATED OR EXPANDED
capital gain (and loss)
long-term unused minimum tax credit
restricted securities
Rule 144
Rule 145
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NEW!
Please help me make sense of my W-2, as I am starting to collect all the information needed for my tax return. Last year I exercised stock options and immediately sold the shares in a cashless exercise on the same day. I also had restricted stock that vested, and I made two purchases under my company's employee stock purchase plan. I still hold the shares from the restricted stock vesting and the ESPP purchase. Where does the income from these appear on my W-2?
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