Hi,
I sold 3 lots of qualifying disposition ESPP shares in 2021. In addition to realizing a Long-Term Capital Gain (LTGC), my employer gives a 15% discount on ESPP purchases, and does not withhold taxes to cover this discount.
According to this TurboTax article , the 15% discount should be reported as “ESPP Ordinary Income” (I’ll say “EOI” for short) on line 7 of the 1040, and the LTCG should be reported as investment income. I’ve entered the ESPP sales into TurboTax using full questionnaire prompting. TurboTax should add the EOI to ordinary income, then adjust share cost basis upward (so the EOI isn’t taxed twice) before calculating LTCG. I do see where TurboTax did the cost basis adjustment and LTCG calculation, but I don’t see where TurboTax adds the EOI to my income. I was able to bring up a 1040 view by following these instructions . Line 7 says "Capital gain or (loss). Attach Schedule D if required", and it has my capital gains filled in there, which I assume are just the long-term capital gains. So did the TurboTax expert who answered in the first link (see above) get it wrong? Is line 7 really where EOI should be reported, if so how to do that when LTCG is already there?? Can you help me find where TurboTax puts the EOI on my tax return? Do I have to fill that out manually, and if so, how?
I tried navigating to my Schedule D (I found these instructions, and these additional instructions) . I'm told in both cases to "Search for Schedule D". I assume this means click the magnifying glass icon on the upper right. Doing so gives me a "Search questions, keywords or topics" dialog box on the right-hand side. When I type "Schedule D" into the text box, I am not presented with a "Jump to Schedule D" search result.
