Employee stock purchase plan (ESPP) shares
Depends on holding period
Is Espp Taxable?
Short answer: The discount on ESPP shares is taxed as wages when you sell; qualifying dispositions get part of the gain taxed as capital gain.
Your 1099-B basis often omits the discount, so adjust it to avoid double tax.
Records to keep: Keep receipts, statements (1098, 1098-T, 1099, W-2G), and a note of what each cost was for. Compare itemizing to the 2026 standard deduction before you claim.
Employee stock purchase plan (ESPP) shares
Depends on holding period
Individuals / Personal Taxes
The discount on ESPP shares is taxed as wages when you sell; qualifying dispositions get part of the gain taxed as capital gain.
Business justification
The discount on ESPP shares is taxed as wages when you sell; qualifying dispositions get part of the gain taxed as capital gain. Your 1099-B basis often omits the discount, so adjust it to avoid double tax.
Category
- Personal Tax Deductions