This is a massively complex area....first, it may not be taxable, and what would be if it is, could require claculations. And it certainly may have been included as taxable income on your W-2 already! Your employer should provide some guidance. I would guess, if you sold and exercised a SAR, like any security owned, it would be reported on Sch D. (Again, those basis issues for the form are not all that clear). Some of a zillion pages on this topic: For purposes of when equity-based compensation is deferred under the nonqualified deferred compensation (NQDC) plan failure rules, nondiscounted stock appreciation rights (SARs) that don't include any additional deferral feature are generally excluded from Code Sec. 409A . Thus, a SAR, i.e., a right to compensation equal to the appreciation in value of a specified number of shares of stock of the service recipient occurring between the date of grant and the date of exercise, doesn't provide for a deferral of compensation if: (A) compensation payable under the SAR can't be greater than the excess of the stock's FMV (disregarding lapse restrictions as defined in Reg § 1.83-3(i) ,on the date of exercise of the SAR over an amount specified on the date of grant of the SAR (the SAR exercise price), with respect to a number of shares fixed on or before the date of grant of the right; (B) the SAR exercise price may never be less than the underlying stock's FMV (disregarding lapse restrictions) on the date the right is granted; and (C) the SAR doesn't include any feature for the deferral of compensation other than the deferral of recognition of income until the exercise of the SAR.
Copyright © 2026 eLLeNow.com All Rights Reserved.