83(b) election - Spidell

83(b) election

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Message Board 83(b) election

This topic contains 1 reply, has 0 voices, and was last updated by Randal Owens 11 months, 2 weeks ago.

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  • #33747
    Randal Owens
    Participant

    A new client came in.  He said he got some company stock and made a 83(b) election with his employer/IRS at the time.  His W-2 is large and probably includes some stock options (he doesn't know).  He also has a K-1 from the company showing only short and long term gain of about $400K  No taxes on the K-1 amount.  There is no 1099 for sale of stock.  Needless to say he owes a lot.  Should I be looking for something relating to the election?  Or is all I can do in preparing the taxes is to rely on the company to correctly report the income and withholding on the W-2……… and also rely on the K-1?  The client really doesn't know what's going on and I'm not sure what to have him ask, if anything.

  • #35442
    Anonymous

    You say he is an employee, so what entity issued him the K-1?  Partnership or S-corp?  How did he come to be a partner or shareholder? Is this the first year for the K-1?   Have you seen the 83(b) election statement?  It should include number of shares transferred, price of shares, FMV of shares, etc.  Maybe the K-1 has nothing to do with the 83(b) property transferred to him as compensation.