Tim980
Level 1

Is this value also part of box 1 Wages? How does it impact the gain (loss) on the sale of the options which are shown on a form 1099B from an investment house? Grateful for any wisdom you can impart.

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itonewbie
Level 15

The bargain element included as compensation, together with the option price, establishes cost basis for the stocks acquired through the exercise.  You should review statements your client received for the grant and exercise so that you could properly account for the cost basis and determine the gain, based on the number of shares that were sold as well as the holding period.

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