The NASPP Blog

As our faithful readers know (because we’ve certainly harped on this topic enough), 2011 Forms 1099-B (which brokers will be sending out shortly) are subject to the new cost-basis reporting requirements. We’ve posted some resources to help you understand the new requirements and help you get a start on materials explaining them to your stock plan participants. In today’s blog entry, I highlight the new (and a few old) materials now available on Naspp.com.

Reporting Examples

We’ve created the following reporting reporting examples. Each example includes an annotated Form 1099-B, Form 8949, and Schedule D so you can see how sales of shares acquired under the various scenarios will appear on each of these forms:

• NQSO Examples
• RSU Example
• ISO Examples
• ESPP Examples

Frequently Asked Questions

We’ve also posted a sample FAQ on the new cost-basis reporting requirements and the new Form 8949. It even includes an annotated Form 8949. Use this as a starting point for your own FAQ for your stock plan participants.

We’ve also posted a sample email that might be sent to employees to alert them to the dangers of not verifying that the cost basis reported on their Form 1099-B is correct.

Flow Charts

Last year, we created the renowned Section 6039 flow charts (one member told us these charts alone made membership worth the cost), which explain how employees can use Forms 3921 and 3922 to report sales of shares acquired under ISOs and ESPPs on their tax returns. Those flow charts have now been updated for the new Form 1099-B and Form 8949. In addition, we’ve created flow charts for NQSOs and RS/RSUs.

• NQSO Flow Charts
• Restricted Stock Flow Charts
• RSU Flow Charts (Without Deferral)
• RSU Flow Charts (With Deferral)
• ISO/ESPP Flow Charts

Use the flow charts as a starting point for creating your own charts for your stock plan participants.

More Information

For more information on cost-basis reporting, check out our alert on the final regulations and our previous blog entries:

• The New Schedule D (December 14, 2011)
• Four Questions to Ask Your Brokers (November 30, 2010)
• Pave the Way for Cost-Basis Reporting Now (November 18, 2010)
• Cost-Basis Reporting: Coming Soon to a Broker Near You (October 26, 2010)
• Cost-Basis Reporting: Complicating an Already Confusing Topic (June 2, 1010)
• Cost-Basis Reporting (December 22, 2009)

For your employees, myStockOptions.com is a great resource, offering illustrated and annotated tax forms, FAQs, and numerous articles on how employees should report sales of stock on their tax return.

NASPP “To Do” List
We have so much going on here at the NASPP that it can be hard to keep track of it all, so I keep an ongoing “to do” list for you here in my blog. 

– Barbara