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Not1percenter
Level 1

Can short term capital gains from sale of stocks acquired through exercise of non qualified stock options given by employer, be offset by capital loss carryovers?

I have $100,000 in capital loss carryovers from previous years. I also have stocks that I acquired after exercising  non qualified stock options granted to me by my employer before it became public. I have owned the stocks for over 7 months now and the company is public. If I sell these stocks now, I will generate short term capital gains. Can my capital loss carryovers offset the above capital gains?
In other words, are short term capital gains from selling stocks acquired from exercising stock options treated the same way as short term capital gains from selling any other stock in a brokerage account? I held the stocks after paying cash for the exercise and the initial taxes and did not do a cashless exercise
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Critter-3
Level 15

Can short term capital gains from sale of stocks acquired through exercise of non qualified stock options given by employer, be offset by capital loss carryovers?

ALL cap gains and losses from all sources  are netted against each other automatically on the Sch D ... the program will do this automatically and any unused losses are carried forward.  

View solution in original post

3 Replies
JohnB5677
Expert Alumni

Can short term capital gains from sale of stocks acquired through exercise of non qualified stock options given by employer, be offset by capital loss carryovers?

Yes you can use your carryover capital losses to offset any other form of capital gain.

 

When you have a net long-term capital loss, you can use it to offset a net short-term capital gain by subtracting the loss from the gain.

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Not1percenter
Level 1

Can short term capital gains from sale of stocks acquired through exercise of non qualified stock options given by employer, be offset by capital loss carryovers?

Thank you for your response. By "net long term capital loss", are you referring to capital loss carry forwards? I am specifically referring to those- ie short term capital losses from previous years that have rolled over to the current year.

 

Thanks again

Critter-3
Level 15

Can short term capital gains from sale of stocks acquired through exercise of non qualified stock options given by employer, be offset by capital loss carryovers?

ALL cap gains and losses from all sources  are netted against each other automatically on the Sch D ... the program will do this automatically and any unused losses are carried forward.  

View solution in original post

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