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.
Several years ago I faced a new situation. I'd been working for a solid Fortune 500 company for a number of years and had a substantial number of stock options, mostly incentive stock options (ISOs). They were quite valuable. What I did not reckon on, however, was the alternative minimum tax. Here is my story.
Video included! Learn how and when income from ISOs is subject to taxes, including the alternative minimum tax. You must consider taxes at both exercise and sale to put together an optimal strategy.
To make the most of incentive stock options (ISOs), you must understand their tax fundamentals, explained by the editor-in-chief of myStockOptions.com in this engaging video.
Incentive stock option (ISO) exercises made during a calendar year must be reported by the company to you and the IRS on Form 3921 by January 31 of the following year. This article explains what you need to know about the information on the form, and how the form can help you better understand the complexities of ISO taxation.
Running parallel to the regular tax system, the alternative minimum tax (AMT) was designed to require extremely wealthy people to pay their fair share of taxes when credits and deductions could otherwise reduce or eliminate their tax liabilities. However, the reach of the AMT has expanded over time to hit middle-income people it was never intended to tax...
ISOs affect your AMT liability in two ways. You should consider these points in your planning both at ISO exercise and when you later sell the acquired shares...
The AMT system is complicated. Broadly, it starts by taking your adjusted gross income, subtracts your itemized deductions, makes certain negative and positive adjustments, and includes certain tax items called tax "preferences." The resulting amount...
It is possible to be subject to the alternative minimum tax if you exercise and hold incentive stock options with a big spread. This FAQ calculates the income thresholds where the AMT can be triggered...
The Tax Cuts & Jobs Act, which took effect in 2018, made significant changes to factors in the calculation of the alternative minimum tax (AMT) that will generally reduce the likelihood of...
If you owe AMT for the tax year in which you exercised an ISO, all or a part of the amount by which your AMT liability exceeds your regular tax liability can generate a tax credit that may...
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.
Listen to our podcast on the basics of stock options, or watch our videos on core concepts and ISO taxes.
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