Why sign in to the Community?

  • Submit a question
  • Check your notifications
Sign in to the Community or Sign in to TurboTax and start working on your taxes
New Member
posted Jun 1, 2019 1:14:48 PM

How can I verify that my qualified ESPP ordinary income was included in Box 1 of my W-2?

I sold shares from my qualified ESPP this year and have filled out the 1099-B information (as well as updated based on the 3922 information).  At the end of entering it asks if the equivalent amount from the ordinary income reported was included in Box 1.  I'm unsure how to verify this through my W-2 or payslips.  In my W-2 box 14 has been filled out with an amount for a "DQD", but I'm not sure if this is relevant.  I do not notice any increases or additional withholdings referenced relative to the sales of the stock in my payslips and the final payslip aggregate seems to match the value in Box 1.

0 4 4589
4 Replies
Level 1
Jun 1, 2019 1:14:50 PM

The information in Box 14 is reporting your stock sales.

See the other answer for a detailed explanation. 

[Edit 3/25/2019 2:45 PM]

Level 13
Jun 1, 2019 1:14:51 PM

But an ESPP is a statutory option so Box 12/Code V would not be appropriate.  A NQSO exercise would be reported here, not the sale of stock acquired via an ESPP.

Level 1
Jun 1, 2019 1:14:51 PM

Please note the edit and the information provided by Mr. Young

Level 13
Jun 1, 2019 1:14:52 PM

Box 14 of a W-2 is where compensation created by the sale of stock acquired through an ESPP does get reported.

There's no hard and fast rules for how employers code things in Box 14 but I'd guess that "DQD" stands for "DisQualified Disposition" and that could be appropriate if you sold the stock less than 2 years after the grant date and/or 1 year after acquiring the stock.  The employer is telling you that this dollar amount IS included in Box 1 of your W-2.

But if all you had was disqualifying dispositions of stock I'd expect that you'd see the amount calculated by TurboTax to be the exact same amount as shown on the W-2.  So, did you only have disqualifying dispositions and do the two amounts match?  If they do then tell TurboTax "Yes".  If they don't then one of two things has happened: 1) you have a mixture of DisQualifying and Qualifying sales and, very commonly, employers DON'T include the qualifying sales on your W-2 or, 2) you entered something incorrectly. 

If the numbers don't match come back and add to this thread.

Tom Young