myStockOptions.com Expands Crucial Tax Return Guidance to Help with New IRS Forms & Reporting for Stock Sales

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This tax season has more potential than ever for confusion, uncertainty, and expensive mistakes for people with stock compensation. Major changes in IRS forms and tax reporting are in effect. These include the expansion of Form 1099-B, which raises much potential confusion, particularly about the cost basis for reporting stock sales. The new Form 8949, which must now be filed alongside the revised Schedule D, will also prompt many questions. The clear, concise, and easy-to-read content of myStockOptions.com can help. The Tax Center at myStockOptions.com shows taxpayers exactly how to report stock compensation and stock sales on tax returns. It's a respected independent source they can trust for tax guidance.

For people with stock compensation (and their financial advisors), every tax season raises worries about making errors on tax returns that can lead to overpayment of tax, IRS penalties, or even an IRS audit. This tax season has more potential than ever for confusion, uncertainty, and expensive mistakes. For holders of stock compensation who sold shares in 2011, major changes in IRS forms and tax reporting are in effect. These include the expansion of Form 1099-B, which raises much potential confusion, particularly about the cost basis for reporting stock sales. The new Form 8949, which must now be filed alongside the revised Schedule D, will also prompt many questions.

The clear, concise, and easy-to-read content of myStockOptions.com can help. The Tax Center at myStockOptions.com shows taxpayers exactly how to report stock compensation and stock sales on tax returns. It's a respected independent source they can trust for tax guidance.

Tax Center: All The Tax Return Answers

The Tax Center at myStockOptions.com has all the answers on the filing and reporting of tax returns that involve stock options, restricted stock, restricted stock units, performance shares, stock appreciation rights, and employee stock purchase plans. Core articles and FAQs spell out the most common mistakes people make with stock grants on their tax returns. Taxpayers, their financial advisors, and their accountants can quickly run through these to be sure they submit error-free returns. Annotated diagrams of IRS forms show exactly how to report sales of company stock. Fun, engaging podcasts and a video convey tips for tax returns, including errors to avoid.

"The tax reporting for stock compensation is complex," emphasizes Bruce Brumberg, Editor-in-Chief of myStockOptions.com. "Even accountants and tax advisors sometimes make mistakes. Our goal is to help employees and their financial or tax advisors realize the full potential of equity grants by educating them about tax rules and helping them prevent costly errors. The last thing taxpayers want, especially now, is to pay too much tax or incur IRS penalties that take yet more money out of their pockets."

Expanded Form 1099-B

At the start of tax season, brokers send IRS Form 1099-B, or the broker's equivalent statement, to clients who sold shares during the tax year. The stock-sale information reported on Form 1099-B has been expanded and now includes not only the gross proceeds from stock sales but also their cost basis (sometimes called the "tax basis"), the date when the shares were acquired, and whether gains or losses were short-term or long-term.

For people who sold shares acquired through equity compensation, these stock sales carry an extra twist in their cost basis. In fact, cost-basis reporting is now more complex and vulnerable to errors. For people unaware of the reporting rules, the resulting confusion may lead to the overpayment of taxes. A thorough new article, FAQ, podcast, and video at myStockOptions.com explain the background, how to understand Form 1099-B after selling shares from stock compensation or an ESPP, and how to avoid mistakes with the cost basis that can lead to the overpayment of taxes.

  • Article: The Revised Form 1099-B & New Form 8949 For Reporting Stock Sales On Your Tax Return: How To Avoid Paying Too Much Tax
  • FAQ: How is IRS Form 1099-B changing for sales of stock acquired from my stock options, restricted stock, or ESPP?
  • Podcast: What's New For Reporting Stock Sales On Your Tax Return
  • Video: New Tax Return Forms & Reporting Rules For Stock Sales

New IRS Form 8949 & Revised Schedule D

The revision of Form 1099-B is not the only IRS curveball this tax season. The changes in the 1099-B information also required a complete revamp of the tax-return forms used to report stock sales. In past years, stock sales were reported on Schedule D of IRS Form 1040. Starting this tax season, taxpayers must complete the new IRS Form 8949 along with Schedule D, which has significantly changed upon the introduction of Form 8949. Both are submitted with the Form 1040 tax return.

The new Form 8949 is where taxpayers list the details of each stock sale, using the information on Form 1099-B, while Schedule D now simply aggregates the column totals from this form to report total long-term and short-term capital gains and losses. "However," points out Mr. Brumberg, "the cost-basis information in Box 3 of Form 1099-B may be too low, or the box may be blank. This is because the new rules for cost-basis reporting are mandatory only for stock acquired in 2011 and later, and brokers will not be required to include the compensation part of the basis until 2013. Additionally, no basis is reported for restricted stock and RSUs."

Sound confusing? It is. Fortunately, myStockOptions.com is always here to help. In the Tax Center, the special section Reporting Company Stock Sales presents FAQs with annotated diagrams of Form 8949 and Schedule D. Each FAQ explains and illustrates a different reporting situation involving stock options, restricted stock, restricted stock units, performance shares, employee stock purchase plans, or stock appreciation rights. Clear instructions and diagrams show how to complete the forms, whether the cost-basis information in Box 3 of Form 1099-B is accurate, too low, or omitted.

Demystifying IRS Forms 3922 And 3921

A different set of content explains IRS Form 3922 for employee stock purchase plans and IRS Form 3921 for incentive stock options. With annotated examples of the forms that translate IRS jargon into understandable language, these articles and FAQs clarify what taxpayers need to understand about the information provided by the forms, which can help them better understand the complexities of ESPP or ISO taxation. While the forms are not needed for tax-return reporting, they give the IRS new tools for catching expensive errors on the tax returns of people who sold ESPP or ISO stock.

Pro Membership Gives Advisors A Crucial Edge During Tax Season

myStockOptions.com Pro is a special membership for financial advisors, CPAs, and other professionals who have clients with stock compensation. MSO Pro gives advisors full access to the whole website and special features in the tools, where they can track and model stock grants for up to 25 separate clients. Access to the vast library of content at myStockOptions.com puts answers to tough client questions right at the fingertips of advisors, who can create PDFs of crucial content with their logo on it for distribution to clients. For more information, visit http://mystockoptions.com, email sales(at)mystockoptions(dot)com, or call 617-734-1979.

Corporate Licensing Available

All the content on myStockOptions.com is ideally suited for licensing by companies and stock plan providers for their stock plan participants. A customized version of the website's award-winning content can be seamlessly woven into companies' HR, benefits, and/or compensation portals. Accessible through any internet browser, 24 hours a day, 7 days a week, licensed content from myStockOptions.com lets stock plan participants answer their own questions about their stock grants whenever they need to learn more—saving time for the stock plan staff and costs for the company. For more information, visit http://mystockoptions.com, email sales(at)mystockoptions(dot)com, or call 617-734-1979.

About myStockOptions.com
With exclusive articles, 750+ FAQs, podcasts, the Tax Center, the Learning Center with courses for CE credit, the Global Tax Guide, an extensive glossary, and interactive patented tools, myStockOptions.com is the premier online resource of educational content and tools on stock options, restricted stock, restricted stock units, performance shares, stock appreciation rights, and employee stock purchase plans. myStockOptions.com is written and managed by leading experts in equity compensation, and is produced by a company with a long history of successful publications explaining complex legal and financial subjects in plain English.

The accounting journal CPA Wealth Provider selected myStockOptions.com among companies "that have taken the lead through innovation, efficiency, initiative, or growth in the financial-planning area." The Specialized Information Publishers' Foundation honored MSO Pro with one of its Editorial Excellence Awards in the category of Best Interactive Content among niche publishers. The influential consumer magazine PC World ranks myStockOptions.com among "the most useful sites ever" that "deliver top-notch information, support, and services." myStockOptions.com also has a related site on nonqualified deferred compensation at http://www.myNQDC.com, and the staff created the successful insider trading prevention video series Think Twice, available at http://www.insidertradingvideos.com.

myStockOptions.com has also received extensive favorable coverage in the media, including BusinessWeek, The Wall Street Journal, The New York Times, the San Francisco Chronicle, and The Boston Globe, and on CNN/fn, National Public Radio, PBS, Money.com, and CBSMarketWatch.com.

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BRUCE BRUMBERG
MYSTOCKOPTIONS.COM
(617) 734-1979
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