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How do I enter a 1099-INT from my broker statement?
Contributed by: MatthewD, FreeTaxUSA Agent, Tax Pro The ease of investing using online accounts has grown. With an app for smart phones, or an online account on your computer, many more people are investing on their own in the stock market. The statement you get from your brokerage company will be a composite statement,…
How do I enter a 1099-DIV from my broker statement?
Contributed by: MatthewD, FreeTaxUSA Agent, Tax Pro The ease of investing through online platforms has grown. With the availability of smartphone apps and online accounts, many more people are investing in the stock market on their own. If you are independently investing, the statement you get from your brokerage company…
How do I enter a 1099-B from a consolidated broker statement?
Contributed by: MatthewD, FreeTaxUSA Agent, Tax Pro With the introduction of online brokerage accounts and apps for smart phones, more people are investing in the stock market on their own. The statement you get from your brokerage company will likely be a composite or consolidated statement and will have several 1099…
What is an employee stock purchase plan (ESPP) and how is the income reported and taxed?
Contributed by KeriC, FreeTaxUSA Agent, Tax Pro In many employer stock purchase plans (ESPP), the purchase of stocks takes place through payroll deductions by making contributions to a stock purchase fund. The employer then uses those funds to purchase the stock for you. In many plans, the price the employee pays for the…
How do I report nonqualified stock options (NSO) or non-statutory stock options (NSQO or NQO)?
Contributed by KeriC, FreeTaxUSA Agent, Tax Pro Income from the exercise of non-statutory stock option If your employer grants you a non-statutory stock option (NSO), the amount of income to include, and the time to include it, depends on whether the fair market value of the option can be readily determined. Readily…
How are incentive (or statutory) stock options (ISO) taxed? and reported?
Contributed by KeriC, FreeTaxUSA Agent, Tax Pro The primary advantage of an incentive stock option (ISO) lies in its favorable tax treatment compared to other types of stock options. Qualifying ISOs only generate reportable income when the stock is sold. Qualifying and Disqualifying ISO A qualifying ISO meets the holding…
Can I withdraw money from my retirement account without having to pay the 10% penalty?
Contributed by: PhillipB, FreeTaxUSA Agent, Tax Pro Most current retirement plans are designed for you to keep money in the account so that the funds accumulate to provide income when you retire. For that purpose, the 10% early distribution penalty was enacted. If a taxpayer takes money out of their retirement account…
What are restricted stock units (RSU)?
Contributed by KeriC, FreeTaxUSA Agent, Tax Pro Restricted Stock Units or RSU's are similar to incentive stock options, but an RSU is taxed when it vests, whereas an Incentive Stock Option (ISO) is taxed when it's exercised. When the RSU vests, the total value of the vested shares will be included in your wages shown in…
How do I file open market stock options on my tax return?
Contributed by: KeriC, FreeTaxUSA Agent, Tax Pro Stock options purchased on the open market do not need to be reported to the IRS. However, when you sell a stock option on the open market, the sale must be reported on Schedule D of your tax return. If you sell stocks or options that you have held for one year or less and…
How are clergy wages reported to the IRS and taxed on your return?
Contributed by: PhillipB, FreeTaxUSA Agent, Tax Pro The income, Social Security, and Medicare tax situation for members of the clergy is very different from the tax situation of average employees. Members of the clergy have the following major differences: Clergy wages are exempt from Social Security and Medicare tax…