Selling ESPP shares acquired while an alien before coming to the US

dirkavalstar · ‎February 11, 2021

I acquired ESPP shares, more than 2 years ago (they are now qualified) as an alien before coming to the US and now have green card.

These shares where obtained with a discount and are currently below both FairMarketValue at grant date and FMV at purchase date. When selling qualified ESPP shares the difference between FMV at grant date and discounted acquisition price is reported as income, which makes me pay tax for shares which I had before coming to the US.

As I was an alien and overseas, I was not given a form 3922 as this is a typical US tax form.

The most correct solution seems to me that I use the actual purchase price as the cost basis and go from there. Am I correct in my assumption?

MarilynG1 · ‎February 11, 2021

The difference between the Purchase Price and the Discount Price of your ESPP stock would correctly be reported as income.

This link gives info for ESPP Discount Reporting without a W-2.

Click this link for detailed info that may help you with your ESPP Stock Sale.

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dirkavalstar · ‎February 12, 2021

Thank you for the reply. I did look at all those cases you mentioned before I posed my question, but nowhere does it mention that the shares were acquired before being a US person and needing to pay tax: I owed these shares before coming into the us, so if I sell these being in the US, I owe capital gains tax, but no income tax as the discount was given before becoming a US person for tax purposes.

Selling ESPP shares acquired while an alien before coming to the US

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