Do I have to pay tax on the sale of my incentive stock
option?
|
| If your stock option is granted under an incentive stock option plan or employee stock
purchase plan, you generally do not include on your tax return any amount in your gross
taxable income as a result of
the grant or exercise of your stock option. You generally treat income or loss from the sale of
the stock obtained from the exercise of the stock option as a taxable capital gain or loss on your
tax return. However, if you do not meet the special
holding
period tests, you may have ordinary taxable income up to the amount of the
gain that you must report on your tax return. Special tax rules
apply to holding periods and the treatment of taxable gains on the sale of the
stock obtained from the exercise of the stock option on your tax
return.
An incentive stock option and employee stock purchase
plans have tricky rules and you
should consult a CPA, Enrolled Agent, Tax Attorney or other tax advisor.
|
 |
 |
Related tax
information about an incentive stock option |
|
|
Employee Stock Options
What does the term "tax basis" mean?
Income Related Questions and Answers |
|
IRS
publications about an incentive stock option:
For further tax information about an incentive stock option refer to
IRS Publication 525, Taxable and
Nontaxable Income; IRS Publication
550, Investment Income and Expenses; and
IRS Publication 551, Basis of
Assets. Also see IRS Publication 17,
Your Federal Income Tax. |
|
 |
|
 |
Ask Julian Block your IRS and tax questions! |
|
|
 |
If you can't find the answer to your IRS or tax question in our
web you can call former IRS Special Agent and one of the country's foremost tax attorneys, nationally syndicated columnist ("The Tax
Adviser") Julian Block. Julian is also the tax Editor of Mutual Funds Magazine, America's premier investment magazine. To
call Julian for a tax consultation click
here. |
|
|
|
