Most lookbacks give you the better of a price at purchase or an earlier price. I would not participate in your ESPP as described, especially for a stock that tanked 60%.ESPP plan with 15% discount. Guessing this one has a lookback period given how my purchase price was calculated?
Price on Grant Date (1/1): $100
Price on Purchase Date (3/31): $40
Average price (entire quarter): $80
My purchase price: (1-0.15)*80 = $68
Yes, I was too busy at work & didn't (still don't) understand how purchase price is calculated.
Let's say I sell at $120. What would the split between W2 income & ST/LT Gain/Loss be for the different scenarios of 2 yr from grant & 1 yr from purchase date?
Scenario A (< 1 yr from purchase date & <2 yr from grant date): W2 income would be ____ ; ST Gain would be ____?
Scenario B (> 1 yr from purchase date & <2 yr from grant date): W2 income would be ____ ; LT Gain would be _____?
Scenario C (> 1 yr from purchase date & >2 yr from grant date): W2 income would be ____ ; LT Gain would be _____?
In Scenario A, since it would not be qualified disposition, can W2 income be negative ($40-68)?
Looks like ESPPs are not always "free money" even with 15% discount if they have lookback. Am I understanding it correctly?
Are you sure your numbers are all correct? You describe a calculation, but then state you don't understand how the purchase price is calculated.
Statistics: Posted by AnEngineer — Wed Dec 27, 2023 4:29 pm — Replies 1 — Views 74