Where is the question on whether ESPP ordinary income is included on W2

[pilchino99]

I know there is a question asking whether the ESPP ordinary income was included on the W2 or not, but can't find it anymore, and I need to change the answer.  How do I navigate to that question?

[TomYoung · Accepted solution]

You don't see that question while entering trade information or editing trades you've already entered.  That question comes up only if you used the "ESPP" step by step interview and only when you're completely done entering trades and click the "Done" or "Continue" button that takes you further into the "Stocks, Mutual Funds, Bonds, Other" interview.   You must work all the way to the very end of the interview. 

Tom Young

[wesher]

Go to the ESP Comp WKS. Uncheck the "yes" box and check the "no" box. The amount will then be transferred to line 7 1040

[nick212]

How do you get to this worksheet?

[wesher]

In View, Forms go to ESP Comp Wks

[wesher]

I originally got to the wks by right clicking on 1040 line 7, clicking "data source", which led me to the Wages, Salaries, and Tips Wks. Then I data sourced line 9 d "Ordinary income..not reported on Form W-2" That led me to Employer Stock Compensation Income Wks Part II Column (g) Total.

[LRC11]

But how do you get to the ESPP step by step interview? ESPP is not listed under any income category.

[wesher]

You get to that in Forms View. Tom Young says that you can get to that question in step by step, but I never got that far.

[praveenswadi]

yeah, it is always difficult to get the step by step. Luckily this time I got it. phew..
@LRC11 I used the online version,
- Click on Federal in the left navbar
- Click on the Wages & Income at the top
- Choose on 'All income'
- Click on Show More for  'Investment Income' with subtitle '1099-B or broker statements'
- Click on Start for Stocks, Mutual Funds, Bonds, Other
- Click on Yes for (Did you sell any investments in 2017)
- Click on Yes for question - Did you get a 1099-B or brokerage statement for these sales?
- I chose "I'll will type it myself"
- Choose a broker
- In the section 'Tell us about your 'broker' 1099-B, I chose "I'll enter one sale at a  time"
Add all the info and click the button "I'll enter additional info on my own"
- In the screen Tell us about your situation
choose I have sales from an Employeee Stock plan,
(If the above  screen does not show up choose the 'Guide me' option instead of "I'll enter additional info on my own"
- Choose ESPP on the next page
- Click continue on next page
- showed me the screen 'we just need a few more details..'. Choose 'Walk me through...' Click continue
- Enter discount, click continue
- asks if you have form 3922 (I did get it)
- Fill in the details, click continue
After couple of screens, it asked me the question 'Is this income reported on W2' Hallelujah!

Honestly, I tried creating another account following the same steps, and it is not showing up anymore. :shrug:

[praveenswadi]

Update : as @TomYoung suggested... You must work all the way to the very end of the interview.
Literally, to the end where you say 'Done' to all. Then the screen comes up saying :
+-------------------------------------------------------------
| On XXXX's Form W-@ (or pay stubs) from Company X, check that the following employee stock plan
| amounts were included in box 1 wages'
| If you're not sure, check with XXX's payroll department or stock plan administrator
+-------------------------------------------------------------

Trick is as Tom said... go to the really really end of the interview....

[LRC11]

Ah, I discovered that even if I only have one ESPP transaction from one lot, I must choose "enter one sale at a time"  rather than "I'll enter a summary".   Unless you choose one sale at a time, you won't see the option to "enter additional info on my own. "   Thanks praveenswadi.

[Fern]

When entering the sale of the shares, indicate that the sale involves an employee stock purchase plan.  See screenshot below. You will then be prompted to enter information about the sale and the amount that is reported on your W-2.

To enter the sale:
• Select Federal Taxes
• Select Wages and Income
• Select Show More at Investment Income
• Select Start at Stocks, Mutual Funds, Bonds and Other

Employee stock purchase plan shares are purchased at a discount. The discount the employee receives on the stock purchase is considered compensation and is reported as ordinary income. Your basis in the stock purchase will be the amount paid for the stock plus the compensation income reported.

The sale of these shares are reported on a Form 1099-B.  The capital gain or loss is the difference between what the stock sold for and your basis.

See the article below for more information.

https://turbotax.intuit.com/tax-tools/tax-tips/Investments-and-Taxes/Employee-Stock-Purchase-Plans/I...

[praveenswadi]

I don't see these screens anymore. I am using TT Premier online. Instead of the first screen where the information is in column format, the new UI shows tabular entry for each cell. And the second screen, highlighted option - not available. :( I remember seeing this last year's return. Not anymore.
Also, talked with a number of friends and at least 2 acknowledged running into same issue. :(

[Anonymous]

Has anyone run into this issue in the latest online version for the 2020 tax year?

I went through the full ESPP workflow, it allowed me to adjust the basis for ordinary income, but never asked me if the ordinary income was on my W2.

[DianeW777]

As long as you entered the correct stock basis and selected Long term noncovered (held more than one year) or Short term noncovered (held one year or less) this places the sale on the appropriate section of Form 8949.  This selection of 'noncovered' clarifies that the basis, if any, on your Form 1099-B needed to be adjusted.