What is the tax basis of employee stock option shares I exercised and sold?
September 30, 2011
Date: 19 Jan 2009
I exercised a same day sale of 500 shares of company stock. The fair market value was $35 per share and the option price $20 per share. What is the tax basis of the shares? How do you handle the selling expenses?
Date: 4 Mar 2009
The tax basis of the shares is $35 per share because you should have reported ordinary income when you exercised and sold them. The brokerage companies usually report the sale price net of selling expenses on Form 1099-B.