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Posted by tom.forrester on April 16, 2007, 4:44 pm
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I am a 35 year old single guy. Last year (6/15/2006), I
sold 60% of my stock in a S Corp that I work for. I was
granted the options in 2000, but I didn't excercise the
options until 12/1/2005. I am now looking down the barrel
of a 600,000 tax bill because of the short- term capital
gain.
Before I click 'submit', is there anything I can do to
minimize the tax payment or spread it out over time?
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Posted by LoTax on April 16, 2007, 6:28 pm
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tom.forres...@gmail.com wrote:
> I am a 35 year old single guy. =A0Last year (6/15/2006), I
> sold 60% of my stock in a S Corp that I work for. =A0I was
> granted the options in 2000, but I didn't excercise the
> options until 12/1/2005. =A0I am now looking down the barrel
> of a 600,000 tax bill because of the short- term capital
> gain.
>
> Before I click 'submit', is there anything I can do to
> minimize the tax payment or spread it out over time?
How much income did you recognize on the exercise of the
options in '05? This adds to your tax basis in the stock
and reduces your gain on its sale in '06. Or are you
already on top of that?
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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Posted by Bill Brown on April 16, 2007, 9:52 pm
Please log in for more thread options tom.forres...@gmail.com wrote:
...
> options until 12/1/2005. I am now looking down the barrel
> of a 600,000 tax bill because of the short- term capital
> gain.
So you had a STCG of $1.7 million more or less?
No, there isn't much you can do, except make sure you used
the right number for your basis in the stock as mentioned
by LoTax.
A huge gain is better than a huge loss. Keep up the excellent
choice of employers and you can retire before ... uh, well,
you can almost retire now.
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by HW \"Skip\" Weldon on April 18, 2007, 1:57 am
Please log in for more thread options om.forrester@gmail.com wrote:
> I am a 35 year old single guy. Last year (6/15/2006), I
> sold 60% of my stock in a S Corp that I work for. I was
> granted the options in 2000, but I didn't excercise the
> options until 12/1/2005. I am now looking down the barrel
> of a 600,000 tax bill because of the short- term capital
> gain.
>
> Before I click 'submit', is there anything I can do to
> minimize the tax payment or spread it out over time?
You got that kind of money and you're doing your own taxes?
<grin>
-HW "Skip" Weldon
Columbia, SC
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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Posted by Tom Forrester on April 18, 2007, 1:57 am
Please log in for more thread options > tom.forres...@gmail.com wrote:
>>
options until 12/1/2005. I am now looking down the barrel
>> of a 600,000 tax bill because of the short- term capital
>> gain.
> So you had a STCG of $1.7 million more or less?
>
> No, there isn't much you can do, except make sure you used
> the right number for your basis in the stock as mentioned
> by LoTax.
>
> A huge gain is better than a huge loss. Keep up the excellent
> choice of employers and you can retire before ... uh, well,
> you can almost retire now.
Yeah, I had a 1.7 mil short-term capital gain. When I
excercised the options at the end of 2005, I didn't pay any
tax -- I might have screwed this up, however. The company
is a small S-Corp so valuation of the shares is tricky. I
assumed that the value was the option value because there
was no other outside valuation. Was this a mistake?
<< ======================================================= >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2006) - All rights reserved. >>
<< ======================================================= >>
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