I have a deep burning tax question I was hoping someone here with some concrete knowledge of this situation could help answer. I was an Independent Contractor at a company that offered me Stock Options. I exercised (only purchased) the stock options last year at the end of Jan. 2021. The stocks were restricted stocks so I could only purchase them, not sell them, and they were also Canadian Stocks. The stock option agreement refers to the plan as an Incentive Stock Option (ISO) plan even though I was an Independent Contractor for the company. I would assume being an IC would have made the stock options fall into the category of being an NSO / NQSO for me, which has immediate tax implications, (i.e. if it is an NSO for me, from everything I've been reading, I am supposed to report the gain between the strike price and FMV at the time of exercise, and it becomes reportable income in the year of the exercise). However, I do remember there being talk of the company treating IC's as employee/W2's for like 1 day or so just for the purpose of these stocks, but I never received a W2 or 1099 from them in relation to the exercise of these stocks or even for any work in 2021 becasue the last time I worked for them was in 2020. I had a year to exercise the option after I left the company in 2020 and took advantage of that in 2021. I am certain the company is still treating this exercise as an ISO and again, I RECEIVED NO 1099 or W2 for this past year when I exercised them, and I don't expect to get one until I sell the shares eventually. I emailed the CEO last year in regards to this being ISO or NSO and his answer was elusive wherin all he would say is please check with an accountant, but typically you do not have a tax liability until you sell the shares and have a capital gain. No taxable event has taken place while you hold them.
MY BIG QUESTION IS THIS: Do I need to report the exercise as an NSO stock option exercise this year on my taxes (even though the stock option agreement refers to these stocks as ISO stocks), or do I just wait until I sell these stocks and get a 1099 or W2 or something from the company and deal with it all then??? I just want to do the right thing. Please help.
