ESPPs
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ESPPs

ESPPs

Employee stock purchase plans offer great benefits. Browse an overview of this section below, or explore the subtopics to the left. See also the ESPP sections of the Tax Center.

Selected Articles

Basics

The Great Benefits Of Your Company's Employee Stock Purchase Plan

Video included! Many employees don't take advantage of their companies' employee stock purchase plans (ESPPs). This article will show you why ESPPs are a good deal and clearly explain the advantages of participating.
Taxes Advanced

12 Tax-Return Mistakes To Avoid With Stock Options And ESPPs This is premium content

Tax returns involving income from stock options or employee stock purchase plans (ESPPs) can be confusing. Recent changes in IRS reporting rules haven't helped. This article explains errors and nasty surprises to avoid.
Basics

VIDEO! Employee Stock Purchase Plans (ESPPs): Core Concepts & Benefits

In this video, the editor-in-chief of myStockOptions.com explains the fundamentals of employee stock purchase plans (ESPPs). Animated examples clearly illustrate the benefits that ESPPs can provide for employees. Running time: 3:35
Show More Selected Articles
Advanced

10 Financial-Planning Rules Every ESPP Participant Should Know This is premium content

Podcast included! Employee stock purchase plans (ESPPs) are a super deal. However, the related taxation and financial planning can be deceptively complex. This article presents the essential points that you should understand before you participate in your company's ESPP.
Rules

ESPPs 101: Key Dates And Terms You Must Know

Podcast and video included! Employee stock purchase plans are a great deal. Understand the key dates and terms you must know to make the most of your company's ESPP.
Taxes

ESPPs 101: Taxation Made Simple (Part 1)

Video included! Your employee stock purchase plan may be one of the best benefits offered by your company. However, to appreciate the advantages of enrolling in the ESPP you must understand the tax consequences of participation. This article series explains the tax basics.
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

Basics

Video included! What are the top 10 questions I should ask about my company's employee stock purchase plan?

Employee stock purchase plans (ESPPs) can be designed in different ways and provided with various features that make them appealing to participants. Before you enroll in your company's ESPP, run through this checklist of questions to answer...
Basics

Video included! What is an employee stock purchase plan? What are the key facts to know?

An employee stock purchase plan (ESPP) is a type of stock plan that permits employees to use after-tax payroll deductions to acquire shares of their company's stock. Plans can have...
Taxes Advanced

What are the biggest mistakes related to my employee stock purchase plan 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 in the 2021 tax season...
Show More Selected FAQs
Basics

What makes a Section 423 ESPP a good deal?

You can purchase company stock at a discount, with special tax treatment when you hold the shares long enough. The deal is even better when your ESPP has...
Basics

Video included! What are the different types of employee stock purchase plans? What are their features? This is premium content

In general, an ESPP fits into one of three categories: tax-qualified, not tax-qualified, or direct purchase...
Advanced

What are the top 10 financial-planning rules for employee stock purchase plans?

Before you participate in your company's employee stock purchase plan (ESPP), understand the following essential points for financial planning with ESPPs...
Advanced

Can my ESPP go underwater or be affected in other ways by falling or volatile stock prices? This is premium content

Employee stock purchase plans cannot be "underwater" in the traditional sense of having a purchase price greater than the current stock price. With an ESPP, the market price at the beginning of an offering does not...
Taxes

Video included! How am I taxed if I participate in a tax-qualified (Section 423) employee stock purchase plan?

You are taxed only at sale, not when the shares are purchased. However, the rules for ESPP taxation are more confusing...
Taxes

Video included! How am I taxed if I participate in a nonqualified employee stock purchase plan?

"Not qualified" means that your company's employee stock purchase plan (ESPP) does not meet the requirements under Section 423 of the Internal Revenue Code. Its mechanics and procedures may be the same as a tax-qualified ESPP, but the favorable tax treatment does not...
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.
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