If you exercise ISO's and do not sell any the stock acquired by 12/31 of the year of exercise then you need to enter the exercise using the "ISO Exercise and Hold" interview. Your "source" document for this should be Form 3921 provided to you by your employer.
If you exercise ISO's and then sell some but not all of the stock before the end of the year then you need to report the sale using the "Stocks, Mutual Funds, Bonds, Other" interview. Your "source" document for this would be Form 1099-B, provided by your broker. And you also need to enter the remaining shares not sold using the "ISO Exercise and Hold" interview.
If you exercise ISO's and sell them all before the end of the year then you only need to use the "Stocks, Mutual Funds, Bonds, Other" interview.
If you sell some or all of the stock on the same day as your exercise then you MIGHT NOT get a 1099-B because brokers are not required to issue 1099-B's for a "same day" sale, (though they are supposed to give you a statement with the same information required by the 1099-B). If you don't get a 1099-B you don't have to report the sale though you might want to anyway as "same day" sales generally result in a small loss due to selling commissions and fees.
I don't think "online" TurboTax Deluxe supports the reporting of stock sales. You probably have to move up to TT Premier.
Tom Young
Where do I find the “Same Day Sale” entry for ISO’s in turbo tax? Sale is recorded in W2 but iso should be recorded without affecting total income.
angel
You will need the Premier version of TurboTax. There is no same day sale that I can find however you would report it as a stock sale with the same date for purchase and sale.
In the search bar, enter stock sales and click the Jump to link
Under Choose the type of investment you sold, choose ISO
You will need to adjust your cost basis to include the ISO amount in your W-2.
Hello,
"You will need to adjust your cost basis to include the ISO amount in your W-2" - should the cost basis price of the option (purchase price) be = to the selling price? because the ISO income was reported on my W2?
The cost basis should be taken from the Box 12, Code V amount on your Form W-2.
Please see the TurboTax Help article How do I fix the basis for an NQSO sale that was also reported on my W-2? for guidance.
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