ISO Stock options

[cpabsd]

Client just called and forgot to tell me she exercised some stock options during 2010. It will result in an amended return. I am trying to understand how to treat properly.

Form 3921 was issued and shows the following:

Date option granted - 11/22/01

Date option exercised - 03/04/10

Exercise price - 7.76 25,000

FMV on exercise date - 20.00 64,420

# of shares - 3221

There was nothing shown on the W-2 with code V. I understand that the AMT adjustment would be $39420. Would this indicate that she exercised the option but did not sell the stock? I have a phone call into the client and am waiting for the return call.

Thanks for clarifying.

Bonnie

[jainen]

>>she exercised the option but did not sell the stock<<

This would seem to be the case, as there is no 1099B. An amended return is not needed unless the AMT adjustment changes her overall tax.

[OldJack]

In as much as this is an Statutory Stock Option (employee) and not a Nonstatutory Stock Option, there is no income to report until the sale of the stock, therefore no code V.

[cpabsd]

An amended return is necessary because the AMT adjustment did create tax due.