Do I owe tax if I use my ESPP to buy a house?
September 26, 2011
Date: Wed, 24 Mar 2010
I’m buying my first house.
I have $20,000 in an employee stock purchase plan. I bought the shares on 12/15/2008, 6/15/2009 and 12/15/2009.
I want to sell the stock and use it as a down payment on the house.
Do I still have to pay capital gains tax for the sale of the stock?
Date: 7 Apr 2010
Yes. There is no exclusion from income for the sale of ESPP shares when the proceeds are used to buy a residence.
Also, you will have disqualifying dispositions for the sales of your ESPP shares before meeting the holding period requirements.
You might want to consult with a tax advisor about what the tax results will be from the disposition, or get a copy of my book, Secrets of Tax Planning For Employee Stock Options, 2009 Edition at http://www.siliconvalleypublishingcompany.com/products/secrets-of-tax-planning-for-employee-stock-options-2014-edition Check out this FAQ http://www.stockoptionadvisors.com/stock/eso-faq/hold/.