How is espp taxed?
Cisco actually gives all the espp at the end of 6 months. I have read somewhere if you sell stock after more than a year you are taxed half . So my question is if you want to avail that tax exemption should you sell it after 1 year when it gets deposited like after 6 months?
Add a comment
Oracle Delphi Jan 27, 2018
Typically specified in your brokerage account which portion is short term vs long term.
Yahoo 7xyz2a Jan 27, 2018
Does yours tell you what’s still a disqualifying disposition? I’ve never seen that.
Cisco SandFlake Jan 28, 2018
They didn’t tax me last two times but this time, they taxed me 33% on the difference of grant price and market price. I didn’t sell the yet but still taxed
Cisco bucks Jan 29, 2018
ESPP gains won’t be taxed until you sell
You pay income tax on the bargain element between sale price (price after the discount) and market price on the day of grant. Any gains or losses from there are treated as capital gains. However, if you sell within two years of the first day of the offering period, you’ve triggered a disqualifying event, so you’ll be taxed at income tax rates for any gains. Long Term Capital Gains rates don’t kick in until the two year mark.
just to add, two years from offering date and not the day they are issued to you, so almost 1.5 years after they are issued
I did say that. :)