IRS tax forms and reporting have changed yet again for the 2021 tax season. myStockOptions explains what taxpayers with stock comp need to know for their tax returns.
(PRUnderground) February 23rd, 2021
IRS tax forms and reporting have changed yet again for the 2021 tax season (for 2020 tax returns), adding confusion to an already complicated process. Key changes include where capital gains and the alternative minimum tax (AMT) are reported on tax returns. With these and the many other tax changes of recent years, the 2021 tax season presents more risk than ever for expensive mistakes, especially the millions of people in the United States who received income in 2020 from employee stock compensation and sales of company shares. Tax-return errors can lead to IRS penalties or an audit.
myStockOptions.com explains the tax-return forms and reporting that taxpayers need to know in its fully updated Tax Center.
“The tax reporting for stock compensation is complex,” emphasizes Bruce Brumberg, Editor-in-Chief of myStockOptions.com. “Even accountants and tax advisors make mistakes. Our goal is to help employees and their advisors realize the full potential of equity comp by educating them about tax rules and helping them prevent costly errors. The last thing taxpayers want is to pay too much tax or incur IRS penalties that take yet more money out of their pockets.”
The IRS Form 1040 tax return has been revised again for the 2020 tax year. New lines include those for the Recovery Rebate Credit (stimulus check) and for estimated tax payments, sometimes made by taxpayers who have stock compensation. Among the line changes, total capital gain or loss from Schedule D is entered on a different line of Form 1040. The totals on Schedule 2 and Schedule 3 are also now entered on different lines of Form 1040 (this applies to anyone with incentive stock options who has triggered the alternative minimum tax). For nonemployees, income is now reported on IRS Form 1099-NEC, not Form 1099-MISC.
An article and an FAQ at myStockOptions.com explain the changes:
The myStockOptions Tax Center has all the answers on the filing and reporting of tax returns that involve stock options, restricted stock, restricted stock units, performance shares, stock appreciation rights, and employee stock purchase plans.
Core articles and FAQs spell out the most common mistakes to avoid. Diagrams of Form W-2, Form 3922 (for employee stock purchase plans), and Form 3921 (for incentive stock options) show how companies report equity compensation income to employees. The reporting of stock sales is made clear by special FAQs with annotated how-to diagrams of IRS tax-return forms. Engaging podcasts and an interactive quiz on tax-return topics help make the experience fun.
Disclaimer: The news site hosting this press release is not associated with myStockOptions.com. It is merely publishing a press release announcement submitted by a company, without any stated or implied endorsement of the information, product or service. Please refer to a tax attorney or CPA for tax advice.
With award-winning content and tools, myStockOptions.com is an independent and unbiased source of expertise on stock options, restricted stock, restricted stock units, performance shares, stock appreciation rights, and employee stock purchase plans. We specialize in making complex stock compensation topics clearly understandable and relatable, in plain English and with an engaging style. Our audience includes:
– stock plan participants
– financial planners, wealth advisors, and CPAs
– professionals in stock plan administration, human resources, compensation, and finance
– attorneys, corporate counsel, and other members of legal staff
In addition to individual memberships, we also offer corporate services.
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