How do I figure cost basis of stock given by employer as gift.?

Question

The value of the stock was less when we sold it than when they originally issued it. The company has yet to send out a 1099B, so I'm trying to use the information I have from the statement of holdings.

Answer 1

Normally those are treated as a bonus by the IRS and are taxed as ordinary income using the value on the date that you receive it. That value becomes your basis. If it's part of a bona fide stock discount purchase plan it's not taxed when you receive it but your basis is your actual cost -- zero in that case.

Answer 2

Your foundation for inventory proficient even as the donor is alive starts with the donor's adjusted foundation. If the truthful marketplace value of the inventory on the date of the present change into more effective than the donor's foundation and the donor paid a present tax (they could have filed type 709) on the move you could upload the portion of the present tax thanks to the appreciation to the donor's foundation. If the cost on the date of present change into below the donor's foundation you've a split foundation contained in the inventory. it truly is least perplexing to objective this with assistance from party. anticipate your mom and father offered the inventory for $10 and it change into nicely worth $6 on the date they gave it to you. in case you promote the inventory for more effective than $10 you take advantage of $10 as your foundation to degree the income. in case you promote the inventory for below $6 you take advantage of $6 as your foundation to degree the loss. in case you promote for any value between $6 and $10 there is no income or loss. bypass to the IRS website and receive guides 544 (sales and different inclinations of sources) and ebook 550 (funding income and prices). I trust the suggestion of others, do no longer settle for the idea from the brokerage living house except they can coach you a confirmation for the acquisition.