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I got the shares of a company as part of the employee stock options program when I was associated with the company when I was living in India.

I moved to USA an year ago on H1B visa. My company got sold and they paid off the share holders based on the number of shares possessed. I am in USA when this transaction happened.

Am I liable to pay tax to IRS for this transaction? If so, what is the percentage? I possessed the shares for more than 5 years.

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You're asking whether the shares you sold while being a US tax resident are taxable in the US.

The answer is yes, they are. How you acquired them or what were the circumstances of the sale is irrelevant. When you acquired them is relevant to the determination of the tax treatment - short or long term capital gains.

You report this transaction on your Schedule D, follow the instructions. Make sure you can substantiate the cost basis properly based on how much you paid for the shares you sold (the taxable income recognized to you at vest).

  • and what about opposite situation: if one acquired stock while working in US on a work visa, and sells the stock after leaving to home country? Anything will need to be done with IRS? – Pavel P Jul 6 '16 at 14:30

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