SARs

NEW! Need a financial, tax, or legal advisor?
Search AdvisorFind from myStockOptions.com

Tax 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.

SARs

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 with our Stock Appreciation Rights quiz and interactive answer key!

Selected Articles

Basics

Stock Appreciation Rights 101 (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.

Taxes

Stock Appreciation Rights 101 (Part 2)

Bruce Brumberg

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

Taxes

Stockbrokers' Secrets: Year-End Planning For NQSOs, Restricted Stock, And RSUs

John P. Barringer, CFP®

Learn about year-end planning for NQSOs and restricted stock/RSUs, including the continued impact of the Tax Cut & Jobs Act and whether the prospect of future tax changes by Congress should influence your decisions.

Selected FAQs

Basics

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...

Basics

What are the top 10 questions I should ask about my stock appreciation rights?

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

Taxes

How are stock appreciation rights taxed?

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

Show More Selected FAQs

Taxes

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 tax return?

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

Taxes

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

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...

Basics

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...

Taxes

I just sold stock that I acquired from option exercises and restricted stock vesting a few years ago. How do I rediscover the cost basis for my tax return?

Let's first review the tax rules and the W-2 reporting. The tax basis for...

Basics

What do surveys and examples reveal about changes in the types of stock compensation grants companies use?

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

Basics

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

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

Taxes

W-2 diagram What will my W-2 show after I exercise stock appreciation rights?

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

Taxes

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 all too easy to make costly tax-return errors that attract unwanted IRS attention. Learn how to prevent mistakes in the 2021 tax season...

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.