How to report loss on cancelled stock options

[disergio]

Hello,

I exercised common stock options of my startup company in 2017 where paid some big amount of money.

In addition to it, I paid taxes on total exercise gain when filed taxes for 2017.

Then in 2018 the company was acquired and all common stock options were cancelled.

What form(s) I need to use to return my money?

Thank you very much!

[NCperson]

Your common stock was “cancelled” or sold ?????

Did you sell your company or did you sell the assets of your company?

Also, your subject line talks about stock OPTION loss ... are you meaning the options you turned into stock???? How would unexercised stock options have “a big loss”????

[NCperson]

I re-read your post and are you describing “ISO’s, otherwise why did you pay tax on the exercised options on 2017?


See the link below

https://turbotax.intuit.com/tax-tips/investments-and-taxes/incentive-stock-options/amp/L4azWgfwy

Read the parts about AMT and bargain basement elements - is that whAt you are dealing with????

[disergio]

This was a startup company.  While working there I received options for price X.

When I left a company I had 3 months to exercise my options with hope they will become stocks if the company goes to IPO or acquired. This is what I did and it cost me good amount of money.

In addition, when filing taxes following year, Alternative Minimum Tax (AMT) was charged. 

The AMT is calculated based on the difference between the fair market value (FMV) of the shares on the date that you exercised the shares and the exercise price.

In 2018 the company was acquired by another one and they cancelled all my options.

I hope it makes clear.