Employee Stock Options

Pelican said...

I held options (granted several years back through an incentive plan, all vested) with a private company of which I was an employee. We were bought by another company in 2010; I was let go and my options were converted into stock certificates for the acquiring company. I sold some of this stock in 2010 and kept the rest. I have 1099B forms for the stocks I sold.

I'm confused on how to declare this for 2010 federal taxes. Do the certificates count as income worth the stock price on the day the certificates were issued, and then I declare a short term capital gain on the part that I sold? Does the fact that the options were granted several years ago make this a long term gain somehow? Thanks!

American Opportunity Credit

shawn said...

Question on American Opportunities tax credit. I learned from a friend a means of taking the credit even though my sons scholarship was roughly equal to the qualified expenses on his 1098T. It seems if the scholarships are unrestricted that you can "designate" that they be used for unqualified - and thus taxable school expenses. While this increases the dependant childs taxable income, it reduces the scholarship monies that must be subtracted off the qualified amount and may allow the parent to take the AO college expense credit up to $2500 for 2009 and 2010. It almost seems to good to be true but there is an example on IRS publication 970 which shows exactly such a case on page 11.

While I am fairly certain I can claim the credit in this manner for 2010, my question is can I go back and get the credit for 2009 by filing an amended return for both my son and myself. While my son had earned income of $4400 in 2009 and would have to pay additional tax and penaltied on the additioanl $4000 of income, this should be more than offest by the credit I would receive at a 25% income bracket. Would love to get some feedback on this - thanks!

Film making business

kimbrovideo said...

Dear Accountant,
I am a self-employed filmmaker who rents video gear to production companies. I am set up as a sole-proprietorship. I fill out time cards for the labor on set and I invoice the production company for my gear. Recently, I had a company ask for a local address so they could apply for a statewide tax-incentive program. Well, I live out of the state so I do not have a local address. My parents live in the state. Could I provide their address to this company? The production company would want me to change the address on my invoice too but since the income from the invoice is taxable, is this legal? Could I put the gear rentals on a "kit rental" form attached to my time card? I want to solve this and not lode a valued client.

Question about a new business

MetalSmitten said...

Hi, I started a mainly online business selling handmade jewelry and did better than I expected. This is currently my only source of income and I have had no outside employer for this full tax year. I am registered within my state (IN), and already gave them their sales tax for my few in-state sales. But now what do I need to do for Federal taxes? Thanks!

Disclosing deceased parent income

Your Personal Accountants: Ask The Accountant: "Carolee1945 said...
I am doing my parents taxes. My dad died in 2009. We have a survivor trust and a bypass trust. My dad had many small investments. Right now, I have 1099's that have the trust name with my mom's social, I have 1099's that have both my parents names with my dads social, I have 1099s with only my dad's name and his social. I understand about the bypass trust which has its own tin,and doing the K-1. What I do not know is this: do I do a 1040 return for my mom, a 1040 for my dad, and then a 1041 for the bypass trust?"

Civil Law Question

Fred said...

This a question on civil law in Massachusetts. I have a court judgment against a home improvement contractor for approximately $16,000. I can recover $10,000 from the Massachusetts Guaranty Fund, can I deduct the difference ($6,000) on my tax return? He has failed to pay any monies.