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    Arun U Rajamma's Avatar
    Arun U Rajamma Posts: 9, Reputation: 1
    New Member
    		  
    #1

    Oct 16, 2007, 09:36 AM
    Tax on stock exercise
    Hi,

    My friend has a salary in the range of 80K/annum. I think his total tax pwecentage is around 33%. He is planning to exercise some stocks worth 12K in the next one month. Does this have any impact on the way in which he's being taxed ? Would he be elevated to a different tax bracket because of this ?
    Hes in the US working on L1 visa.

    Thanks,
    Arun
    AtlantaTaxExpert's Avatar
    AtlantaTaxExpert Posts: 21,836, Reputation: 846
    Senior Tax Expert
    		  
    #2

    Oct 16, 2007, 12:37 PM
    He is squarely in the 25% tax bracket if he is single or the 15% tax bracket if married.

    Given the amount of money involved, the stock option will be taxed one of those two rates (depending on marital status).

    In other words, it is not enough to propel him to the next tax bracket.
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