Tax Center

Tax Center

As featured in PLANSPONSOR, Accounting Today, and CPA Practice Advisor, the myStockOptions Tax Center explains the tax withholding, reporting, and filing for stock options, restricted stock/RSUs, performance shares, ESPPs, and SARs.

Want to know more? Listen to our podcast on tax return tips and how to avoid reporting mistakes!

Check out our podcast and video on the tax forms and reporting rules for stock sales.

Selected Articles

Tax Changes UPDATES!

Tax Season 2021: What You Must Know About New Reporting Rules

Ready or not, tax-return reporting has changed yet again for the 2021 tax season. This article presents the key points you need to know for your federal tax return if you had income in 2020 from stock compensation and/or sales of company stock.
NQSO Tax Returns

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

Puzzled by what to do with your W-2, Form 1099-B, or Forms 3921 and 3922? Don't quite know how and where to report sales of company stock on Form 8949 and Schedule D? Tax returns involving income from stock options or ESPPs can be confusing. Recent changes in IRS reporting rules haven't helped. This article explains errors and nasty surprises to avoid.
Restricted Stock Tax Returns

Restricted Stock & RSUs: 10 Mistakes To Avoid On Your Tax Return This is premium content

Tax returns involving income from restricted stock and restricted stock units (RSUs) can be confusing. The potential for mistakes has been increased by recent changes in IRS reporting rules. This article explains errors to avoid when reporting stock compensation and stock sales.
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Restricted Stock Tax Returns

Get Cost Basis Right To Avoid Overpaying Tax On Stock Sales: Understand IRS Forms 1099-B And 8949 For Tax Returns This is premium content

UPDATES! The stock-sale information provided by brokers on IRS Form 1099-B has changed. Cost-basis reporting, both for your broker on Form 1099-B and for you on your tax return, is now more complex, confusing, and vulnerable to errors. This article explains the crucial facts you must know to avoid overpaying tax or attracting unwanted IRS attention.
ESPP Basics

ESPPs 101: Taxation Made Simple (Part 1)

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.
NQSO Basics

VIDEO! Employee Stock Options: NQSO Taxation

To make the most of nonqualified stock options (NQSOs), you must understand their taxation. Learn the tax basics of NQSOs in this video, which features clear and concise explanations by the editor-in-chief of myStockOptions.com. Running time: 2:58.
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

Restricted Stock Tax Returns

What are the biggest mistakes with restricted stock or RSUs 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...
Restricted Stock Tax Returns

What are the top 10 questions I should ask before I report my stock sales on my tax return?

You should know the answers to the questions in this FAQ's checklist. They will help you be sure you report your stock sales accurately and avoid costly mistakes that attract the attention of the IRS...
Restricted Stock Basics

Do you have a brief overview of the tax treatment for stock options, restricted stock, RSUs, and ESPPs? This is premium content

The table in this FAQ shows the types of taxes, when they are triggered, and the tax withholding (if any) for various forms of equity compensation granted in the United States. For details, examples, and illustrations...
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Restricted Stock Basics

When and how is a grant of restricted stock or RSUs taxed?

The timing of taxation is different than that of stock options. You pay tax at the time the restrictions on the stock lapse. This occurs when...
Tax Changes UPDATES!

UPDATES! What's new for the 2021 tax-return season?

Ready or not, tax-return reporting has changed yet again for the 2021 tax season...
NQSO Basics

When are nonqualified stock options taxed?

You are taxed when you exercise nonqualified stock options and thus acquire the underlying shares of your company's stock. The difference between the market price of the stock at exercise and your exercise price is...
ESPP Basics

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...
NQSO Basics

What happens with taxes on stock options if I live or work in different states during the period between grant and exercise? This is premium content

Generally, each state you live in determines what income is taxable and when. For administrative ease, many companies...
NQSO Basics

What is capital gain and capital loss? What are the tax rates on capital gains?

Capital gain is income that arises from the sale of a capital asset. Gain from the sale of securities held for investment, such as shares acquired from stock compensation...
NQSO Basics

How is capital gain calculated?

The amount of your capital gain is the difference between your sales price and your tax basis in the stock. However, with stock from equity compensation, your tax basis can be harder to determine. It is...
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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