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globalfish
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| Posted: 25 Aug 2011 at 05:58 | IP Logged
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I am using Becker. Can anybody tell me where is the tax treatment for stock option to both company and individual? Thanks. I did not see related material in R1, R2 and R3.
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AUD-10/14/10,waiting
BEC-10/15/10,86
FAR-10/16/10,89
REG-will take in 2011
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crabbing
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| Posted: 26 Aug 2011 at 00:28 | IP Logged
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I have the same question. could anybody help for it?
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Mark7
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| Posted: 27 Aug 2011 at 16:08 | IP Logged
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Basically on exercise the individual does not have to pay tax. (the difference between X price and FMV @ issue) Look at R-2, there is one line in Becker on page 50 or something about this.
BUT for AMT it is part of the Calc. Just look at the example and get an idea on how to do it, you probably won't have to do it.
ALSO KNOW THE DIFFERENCE BETWEEN THE TWO AND HOW THEY ARE TREATED AT EMPLOYER LEVEL.
Remember:
1) ISO = Held more than 1 year from X date = LTCG
2) ISO = 2 years from Grant Date = LTCG
For the Corp:
Employer generally does not claim a corporate income tax deduction
NON-QUAL options for individual:
Result in taxable income to the recipient at the time that they are exercised, the amount being the difference between the exercise price and the market value on that date.
For the Corp:
Employers are is allowed to take a tax deduction
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Topic: stock option treatment
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