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Level 1
posted Jun 3, 2019 1:23:44 PM

> However, hang on to your Form 3922, as you'll need it to figure your cost basis when you sell your ESPP shares down the road. < but why? wouldn't 1099-B have cost basis

but why? wouldn't 1099-B have cost basis when you sell your ESPP later?

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Level 13
Jun 3, 2019 1:23:45 PM

Starting in 2014 brokers are only required to report the "out of pocket" costs associated with the sale of these shares, so "yes" the 1099-B would have a cost basis, it just wouldn't be the correct cost basis.

Too, if you sell the stock in a Qualified disposition - owned for a least 1 year and 2 years after the grant date - then the calculation of basis and compensation not simply the discount you paid on the stock.  The correct calculation depends on the FMV of the stock at the date of grant, information that's on the Form 3922.

Tom Young

1 Replies
Level 13
Jun 3, 2019 1:23:45 PM

Starting in 2014 brokers are only required to report the "out of pocket" costs associated with the sale of these shares, so "yes" the 1099-B would have a cost basis, it just wouldn't be the correct cost basis.

Too, if you sell the stock in a Qualified disposition - owned for a least 1 year and 2 years after the grant date - then the calculation of basis and compensation not simply the discount you paid on the stock.  The correct calculation depends on the FMV of the stock at the date of grant, information that's on the Form 3922.

Tom Young