I have a statement of taxable income for unvested exercises with 83(B): on vest. Where does this go on my tax return?

[Rick19744 · Accepted solution]

I want to expand on this. 

The Section 83(b) election needs to be mailed to the IRS at the Service Center where you file your tax return within 30 days after the date the stock is transferred to you.    Hopefully you have done this.  If not, that is a problem.

In general, with restricted stock, it is not taxable until the year in which it becomes substantially vested.  With the 83(b) election you are making the election to include the value of this stock in your income NOW.  I would assume this income component is included in your W-2, and as such, you don't have to input this any where else.

In past years, making a Section 83(b) election prevented those individuals from being able to efile their tax returns since this form / election needed to be attached to the return (as well as mailed as explained above).  The IRS has recently eased their requirements here.  There are proposed regulations that apply to transfers of property after December 31, 2015 that a copy of the Section 83(b) election does not need to be attached with the taxpayers tax return. 

The preamble to the proposed regulations state that taxpayers may rely on the proposed regulations for property transfers after December 31, 2014. 

In summary, if you mailed a copy of the Section 83(b) election to the IRS Service Center within 30 days of receiving the stock, you can rely on the proposed regulations and do not also have to attach a copy of the election to your tax return.

[Rick19744]

Since some are still relying on this post, I just want to make it clear that the IRS has issued final regs that remove the requirement that a taxpayer submit a copy of Code Sec. 83(b) election with the return for the year in which the property subject to election was transferred. This applies to property transferred on or after 1/1/2016.
Taxpayers must still make the election as noted above within 30 days after the transfer.  Without this separate statement mailed to the IRS there is no election.

[Critter]

It is not entered anywhere in the TT program or on the tax return.  It is an election form that needs to be attached to a paper copy of your timely filed tax return which means you have to mail in the return.