When your restricted stock, restricted stock units (RSUs), performance shares, or performance units vest, you may have taxable ordinary income to report when you file your tax return, in addition to any capital gains or losses upon sale of that stock. Follow the steps outlined in this document to help you determine the IRS tax-reporting requirements. In this guide, the term “restricted stock” includes restricted stock units.

14

4Your Restricted Stock and Performance Awards

INSIDEHow to use the

Supplemental form to help avoid

overpaying taxes

Determining your 2019stock plan tax requirements— a step-by-step guide

Gather the following documents.1

Your Restricted Stock and Performance Awards

2* Fidelity is not involved in the preparation of the content supplied at the third-party unaffiliated website and does not guarantee or assume any responsibility for its content.

Form W-2 (or 1099-MISC if you are a nonemployee)

This form will be provided by your company.Your company’s payroll department

IRS Form 1040 and Schedule DForms are available online at www.irs.gov,* by calling 800.TAX.FORM (800.829.3676), or by visiting your local IRS office.

Your local IRS office or your tax advisor

IRS Form 8949 This form is available online at www.irs.gov,* by calling 800.TAX.FORM (800.829.3676), or by visiting your local IRS office.

Your local IRS office or your tax advisor

Form 1099-B

You can access the form by logging in to Fidelity.com/taxforms at the end of January. In addition, a form will be mailed to you no later than mid-February, if applicable.

A Fidelity Stock Plan Services Representative at the number provided on the statement

2019 Supplemental Information (Fidelity is providing you with additional information to supplement your 1099-B due to IRS cost basis regulations that no longer permit brokers to include ordinary income.)

You can access the form by logging in to Fidelity.com/taxforms at the end of January. In addition, a form will be mailed to you no later than mid-February, if applicable.

A Fidelity Stock Plan Services Representative at the number provided on the statement

FORM/DATA WHERE TO FIND IT WHO TO CALL

4

4

Form 1099-B

Supplemental Information form

Participant uses these Fidelity forms…

to complete…

Rolls up into

Rolls up into

Form 8949Department of the Treasury Internal Revenue Service

Sales and Other Dispositions of Capital Assets▶ Go to www.irs.gov/Form8949 for instructions and the latest information.

▶ File with your Schedule D to list your transactions for lines 1b, 2, 3, 8b, 9, and 10 of Schedule D.

OMB No. 1545-0074

2019Attachment Sequence No. 12A

Name(s) shown on return Social security number or taxpayer identification number

Before you check Box A, B, or C below, see whether you received any Form(s) 1099-B or substitute statement(s) from your broker. A substitute statement will have the same information as Form 1099-B. Either will show whether your basis (usually your cost) was reported to the IRS by your broker and may even tell you which box to check.

Part I Short-Term. Transactions involving capital assets you held 1 year or less are generally short-term (see instructions). For long-term transactions, see page 2. Note: You may aggregate all short-term transactions reported on Form(s) 1099-B showing basis was reported to the IRS and for which no adjustments or codes are required. Enter the totals directly on Schedule D, line 1a; you aren’t required to report these transactions on Form 8949 (see instructions).

You must check Box A, B, or C below. Check only one box. If more than one box applies for your short-term transactions, complete a separate Form 8949, page 1, for each applicable box. If you have more short-term transactions than will fit on this page for one or more of the boxes, complete as many forms with the same box checked as you need.

(A) Short-term transactions reported on Form(s) 1099-B showing basis was reported to the IRS (see Note above)(B) Short-term transactions reported on Form(s) 1099-B showing basis wasn’t reported to the IRS(C) Short-term transactions not reported to you on Form 1099-B

1

(a) Description of property

(Example: 100 sh. XYZ Co.)

(b) Date acquired (Mo., day, yr.)

(c) Date sold or disposed of

(Mo., day, yr.)

(d) Proceeds

(sales price) (see instructions)

(e) Cost or other basis. See the Note below and see Column (e)

in the separate instructions

Adjustment, if any, to gain or loss. If you enter an amount in column (g),

enter a code in column (f). See the separate instructions.

(f) Code(s) from instructions

(g) Amount of adjustment

(h) Gain or (loss).

Subtract column (e) from column (d) and combine the result

with column (g)

2

Totals. Add the amounts in columns (d), (e), (g), and (h) (subtract negative amounts). Enter each total here and include on your Schedule D, line 1b (if Box A above is checked), line 2 (if Box B above is checked), or line 3 (if Box C above is checked) ▶

Note: If you checked Box A above but the basis reported to the IRS was incorrect, enter in column (e) the basis as reported to the IRS, and enter an adjustment in column (g) to correct the basis. See Column (g) in the separate instructions for how to figure the amount of the adjustment.

For Paperwork Reduction Act Notice, see your tax return instructions. Cat. No. 37768Z Form 8949 (2019)

SCHEDULE D (Form 1040 or 1040-SR)

Department of the Treasury Internal Revenue Service (99)

Capital Gains and Losses▶ Attach to Form 1040, 1040-SR, or 1040-NR.

▶ Go to www.irs.gov/ScheduleD for instructions and the latest information. ▶ Use Form 8949 to list your transactions for lines 1b, 2, 3, 8b, 9, and 10.

OMB No. 1545-0074

2019Attachment Sequence No. 12

Name(s) shown on return Your social security number

Did you dispose of any investment(s) in a qualified opportunity fund during the tax year? Yes NoIf “Yes,” attach Form 8949 and see its instructions for additional requirements for reporting your gain or loss.

Part I Short-Term Capital Gains and Losses—Generally Assets Held One Year or Less (see instructions)

See instructions for how to figure the amounts to enter on the lines below. This form may be easier to complete if you round off cents to whole dollars.

(d) Proceeds

(sales price)

(e) Cost

(or other basis)

(g) Adjustments

to gain or loss from Form(s) 8949, Part I,

line 2, column (g)

(h) Gain or (loss) Subtract column (e) from column (d) and combine the result

with column (g)

1a

Totals for all short-term transactions reported on Form 1099-B for which basis was reported to the IRS and for which you have no adjustments (see instructions). However, if you choose to report all these transactions on Form 8949, leave this line blank and go to line 1b .

1b

Totals for all transactions reported on Form(s) 8949 with Box A checked . . . . . . . . . . . . .

2

Totals for all transactions reported on Form(s) 8949 with Box B checked . . . . . . . . . . . . .

3

Totals for all transactions reported on Form(s) 8949 with Box C checked . . . . . . . . . . . . .

4 Short-term gain from Form 6252 and short-term gain or (loss) from Forms 4684, 6781, and 8824 . . 4 5

Net short-term gain or (loss) from partnerships, S corporations, estates, and trusts from Schedule(s) K-1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

6

Short-term capital loss carryover. Enter the amount, if any, from line 8 of your Capital Loss Carryover Worksheet in the instructions . . . . . . . . . . . . . . . . . . . . . . . . 6 ( )

7

Net short-term capital gain or (loss). Combine lines 1a through 6 in column (h). If you have any long-term capital gains or losses, go to Part II below. Otherwise, go to Part III on the back . . . . . . 7

Part II Long-Term Capital Gains and Losses—Generally Assets Held More Than One Year (see instructions)

See instructions for how to figure the amounts to enter on the lines below. This form may be easier to complete if you round off cents to whole dollars.

(d) Proceeds

(sales price)

(e) Cost

(or other basis)

(g) Adjustments

to gain or loss from Form(s) 8949, Part II,

line 2, column (g)

(h) Gain or (loss) Subtract column (e) from column (d) and combine the result

with column (g)

8a

Totals for all long-term transactions reported on Form 1099-B for which basis was reported to the IRS and for which you have no adjustments (see instructions). However, if you choose to report all these transactions on Form 8949, leave this line blank and go to line 8b .

8b

Totals for all transactions reported on Form(s) 8949 with Box D checked . . . . . . . . . . . . .

9

Totals for all transactions reported on Form(s) 8949 with Box E checked . . . . . . . . . . . . .

10

Totals for all transactions reported on Form(s) 8949 with Box F checked. . . . . . . . . . . . . .

11

Gain from Form 4797, Part I; long-term gain from Forms 2439 and 6252; and long-term gain or (loss) from Forms 4684, 6781, and 8824 . . . . . . . . . . . . . . . . . . . . . . . 11

12 Net long-term gain or (loss) from partnerships, S corporations, estates, and trusts from Schedule(s) K-1 12 13 Capital gain distributions. See the instructions . . . . . . . . . . . . . . . . . . . 13 14

Long-term capital loss carryover. Enter the amount, if any, from line 13 of your Capital Loss Carryover Worksheet in the instructions . . . . . . . . . . . . . . . . . . . . . . . . 14 ( )

15

Net long-term capital gain or (loss). Combine lines 8a through 14 in column (h). Then go to Part III onthe back . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

For Paperwork Reduction Act Notice, see your tax return instructions. Cat. No. 11338H Schedule D (Form 1040 or 1040-SR) 2019

Form 8949

Form1040 Department of the Treasury—Internal Revenue Service (99)

U.S. Individual Income Tax Return 2019 OMB No. 1545-0074 IRS Use Only—Do not write or staple in this space.

Filing Status Check only one box.

Single Married filing jointly Married filing separately (MFS) Head of household (HOH) Qualifying widow(er) (QW)

If you checked the MFS box, enter the name of spouse. If you checked the HOH or QW box, enter the child’s name if the qualifying person is

a child but not your dependent. ▶

Your first name and middle initial Last name Your social security number

If joint return, spouse’s first name and middle initial Last name Spouse’s social security number

Home address (number and street). If you have a P.O. box, see instructions. Apt. no.

City, town or post office, state, and ZIP code. If you have a foreign address, also complete spaces below (see instructions).

Foreign country name Foreign province/state/county Foreign postal code

Presidential Election CampaignCheck here if you, or your spouse if filing jointly, want $3 to go to this fund. Checking a box below will not change your tax or refund. You Spouse

Standard Deduction

Someone can claim: You as a dependent Your spouse as a dependent

Spouse itemizes on a separate return or you were a dual-status alien

Age/Blindness You: Were born before January 2, 1955 Are blind Spouse: Was born before January 2, 1955 Is blind

If more than four dependents, see instructions and ✓ here ▶

Dependents (see instructions): (2) Social security number (3) Relationship to you (4) ✓ if qualifies for (see instructions):

(1) First name Last name Child tax credit Credit for other dependents

1 Wages, salaries, tips, etc. Attach Form(s) W-2 . . . . . . . . . . . . . . . . . . 1

2a Tax-exempt interest . . . . 2a b Taxable interest. Attach Sch. B if required 2b

3a Qualified dividends . . . . 3a b Ordinary dividends. Attach Sch. B if required 3b

4a IRA distributions . . . . . 4a b Taxable amount . . . . . . 4b

c Pensions and annuities . . . 4c d Taxable amount . . . . . . 4d

5a Social security benefits . . . 5a b Taxable amount . . . . . . 5b

6 Capital gain or (loss). Attach Schedule D if required. If not required, check here . . . . . . . ▶ 6

7a Other income from Schedule 1, line 9 . . . . . . . . . . . . . . . . . . . . 7a

b Add lines 1, 2b, 3b, 4b, 4d, 5b, 6, and 7a. This is your total income . . . . . . . . . . . ▶ 7b

8 a Adjustments to income from Schedule 1, line 22 . . . . . . . . . . . . . . . . . 8a

b Subtract line 8a from line 7b. This is your adjusted gross income . . . . . . . . . . . ▶ 8b

9 Standard deduction or itemized deductions (from Schedule A) . . . . .

Standard Deduction for—• Single or Married

filing separately, $12,200

• Married filing jointly or Qualifying widow(er), $24,400

• Head of household, $18,350

• If you checked any box under Standard Deduction, see instructions.

9

10 Qualified business income deduction. Attach Form 8995 or Form 8995-A . . . 10

11a Add lines 9 and 10 . . . . . . . . . . . . . . . . . . . . . . . . . 11a

b Taxable income. Subtract line 11a from line 8b. If zero or less, enter -0- . . . . . . . . . . . 11b

For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see separate instructions. Cat. No. 11320B Form 1040 (2019)

Form 1040Schedule D

Form1040 Department of the Treasury—Internal Revenue Service (99)

U.S. Individual Income Tax Return 2019 OMB No. 1545-0074 IRS Use Only—Do not write or staple in this space.

Filing Status Check only one box.

Single Married filing jointly Married filing separately (MFS) Head of household (HOH) Qualifying widow(er) (QW)

If you checked the MFS box, enter the name of spouse. If you checked the HOH or QW box, enter the child’s name if the qualifying person is

a child but not your dependent. ▶

Your first name and middle initial Last name Your social security number

If joint return, spouse’s first name and middle initial Last name Spouse’s social security number

Home address (number and street). If you have a P.O. box, see instructions. Apt. no.

City, town or post office, state, and ZIP code. If you have a foreign address, also complete spaces below (see instructions).

Foreign country name Foreign province/state/county Foreign postal code

Presidential Election CampaignCheck here if you, or your spouse if filing jointly, want $3 to go to this fund. Checking a box below will not change your tax or refund. You Spouse

Standard Deduction

Someone can claim: You as a dependent Your spouse as a dependent

Spouse itemizes on a separate return or you were a dual-status alien

Age/Blindness You: Were born before January 2, 1955 Are blind Spouse: Was born before January 2, 1955 Is blind

If more than four dependents, see instructions and ✓ here ▶

Dependents (see instructions): (2) Social security number (3) Relationship to you (4) ✓ if qualifies for (see instructions):

(1) First name Last name Child tax credit Credit for other dependents

1 Wages, salaries, tips, etc. Attach Form(s) W-2 . . . . . . . . . . . . . . . . . . 1

2a Tax-exempt interest . . . . 2a b Taxable interest. Attach Sch. B if required 2b

3a Qualified dividends . . . . 3a b Ordinary dividends. Attach Sch. B if required 3b

4a IRA distributions . . . . . 4a b Taxable amount . . . . . . 4b

c Pensions and annuities . . . 4c d Taxable amount . . . . . . 4d

5a Social security benefits . . . 5a b Taxable amount . . . . . . 5b

6 Capital gain or (loss). Attach Schedule D if required. If not required, check here . . . . . . . ▶ 6

7a Other income from Schedule 1, line 9 . . . . . . . . . . . . . . . . . . . . 7a

b Add lines 1, 2b, 3b, 4b, 4d, 5b, 6, and 7a. This is your total income . . . . . . . . . . . ▶ 7b

8 a Adjustments to income from Schedule 1, line 22 . . . . . . . . . . . . . . . . . 8a

b Subtract line 8a from line 7b. This is your adjusted gross income . . . . . . . . . . . ▶ 8b

9 Standard deduction or itemized deductions (from Schedule A) . . . . .

Standard Deduction for—• Single or Married

filing separately, $12,200

• Married filing jointly or Qualifying widow(er), $24,400

• Head of household, $18,350

• If you checked any box under Standard Deduction, see instructions.

9

10 Qualified business income deduction. Attach Form 8995 or Form 8995-A . . . 10

11a Add lines 9 and 10 . . . . . . . . . . . . . . . . . . . . . . . . . 11a

b Taxable income. Subtract line 11a from line 8b. If zero or less, enter -0- . . . . . . . . . . . 11b

For Disclosure, Privacy Act, and Paperwork Reduction Act Notice, see separate instructions. Cat. No. 11320B Form 1040 (2019)

a Employee’s social security number

OMB No. 1545-0008

Safe, accurate, FAST! Use

Visit the IRS website at www.irs.gov/efile

b Employer identification number (EIN)

c Employer’s name, address, and ZIP code

d Control number

e Employee’s first name and initial Last name Suff.

f Employee’s address and ZIP code

1 Wages, tips, other compensation 2 Federal income tax withheld

3 Social security wages 4 Social security tax withheld

5 Medicare wages and tips 6 Medicare tax withheld

7 Social security tips 8 Allocated tips

9 10 Dependent care benefits

11 Nonqualified plans 12a See instructions for box 12Co d e

12bCo d e

12cCo d e

12dCo d e

13 Statutory employee

Retirement plan

Third-party sick pay

14 Other

15 State Employer’s state ID number 16 State wages, tips, etc. 17 State income tax 18 Local wages, tips, etc. 19 Local income tax 20 Locality name

Form W-2 Wage and Tax Statement 2019

Department of the Treasury—Internal Revenue Service

Copy B—To Be Filed With Employee’s FEDERAL Tax Return. This information is being furnished to the Internal Revenue Service.

*

Example: IRS W-2 for Restricted Stock/RSUs and Form 1040

Your Restricted Stock and Performance Awards

Your equity compensation awards are considered ordinary income to you and taxable in the year your grant vests and/or shares are delivered to you (assuming there is no deferral or a Section 83(b) election). Your compensation is the fair market value (FMV) of a share at vesting less the amount (if any) you paid per share, multiplied by the number of shares vested. If you are an employee, your employer should have already included the value of your award in your W-2. If you are a nonemployee (such as a contractor, consultant, or director), you should have received a 1099-MISC. In addition to ordinary income, you may owe tax on any capital gains resulting from the sale of your stock, which is explained in later steps.

The value of the award is included in boxes 1 and 5 and also in box 3 up to the maximum wage base.

Federal taxes withheld on the award value are included in boxes 2 and 6, and in box 4 up to the maximum wage base.

The value of the award is included in boxes 16 and 18, if state and local taxes apply. Tax on the value is included in boxes 17 and 19, if applicable.

Report your ordinary income.2

3For illustrative purposes only.

For illustrative purposes only.

W-2 income is reported on line 1 of

Form 1040. (Income from 1099-MISC is reported

on Schedule C.)

* Fidelity is not involved in the preparation of the content supplied at the third-party unaffiliated website and does not guarantee or assume any responsibility for its content.

Your employer may also use box 14 to

show the income from stock compensation (included in box 1).

4

4

You will need to refer to two documents: your Fidelity Brokerage Form 1099-B tax-reporting statement and your 2019 Supplemental Information form. The Supplemental Information form may contain information that is not reported on your 1099-B due to cost basis regulations. If the amounts on these two forms differ, you’ll need to use information from both to complete your tax forms to ensure that you don’t overpay in taxes.

21 4 53 6 7

Your Restricted Stock and Performance Awards

Assemble information on the sale of your stock.

3

4

Example: Fidelity Brokerage 1099-B Tax-Reporting Statement

For illustrative purposes only.

Continues

1 — CUSIP (your company’s ticker/ trading symbol)

2 — Quantity (number of shares sold)

3 — Date Acquired (also known as the date of vesting or distribution)

4 — Date Sold or Disposed

5 — Proceeds (gross proceeds from stock sale)

6 — Cost or Other Basis (this is provided to the IRS, as directed, and may need to be adjusted—see the Supplemental form). The IRS does not allow brokers to report the basis for this type of stock compen-sation. (See the FAQs at the end of this guide for details.)

7 — Gain/Loss (from the proceeds of the sale and may also need to be adjusted—see the Supplemental form)

4

4

Your Restricted Stock and Performance Awards

Assemble information on the sale of your stock.

3

5

Example: 2019 Supplemental Information Form

For illustrative purposes only.

8 — Ordinary Income Reported (cross-reference this with your company W-2 and input in column (g) of Form 8949)

— Adjusted Cost Basis (this amount is used to recalculate your gain/loss and is equal to the ordinary income plus the cost basis on your 1099-B)

— Adjusted Gain/Loss (recalculated per your adjusted basis; proceeds minus your adjusted cost basis—this amount goes in column (h) of Form 8949)

9

10

9 1089 108

4

4

Your Restricted Stock and Performance Awards

Use the information from IRS Form 1099-B and Fidelity’s Supplemental Information form to complete IRS Form 8949.

4

6For illustrative purposes only.

To complete Form 8949 and Schedule D, you need to know:

• Which shares you sold from which grant

• When you acquired those shares (i.e., the vesting/distribution date)

• The value of the stock at vesting/distribution

• The date of sale

• The sale price and whether it is net of commission

• Your cost basis (from the Supplemental form)

Example: Restricted Stock and Performance Awards: Hold at vesting and sell within one year (Short-Term)

Continues

4

4

Your Restricted Stock and Performance Awards

Use the information from IRS Form 1099-B and Fidelity’s Supplemental Information form to complete IRS Form 8949.

4

7

For illustrative purposes only.

To complete Form 8949 and Schedule D, you need to know:

• Which shares you sold from which grant

• When you acquired those shares (i.e., the vesting/distribution date)

• The value of the stock at vesting/distribution

• The date of sale

• The sale price and whether it is net of commission

• Your cost basis (from the Supplemental form)

Example: Restricted Stock and Performance Awards: Hold at vesting and sell after one year (Long-Term)

4

4

Your Restricted Stock and Performance Awards

Gain or loss from the sale of the stock should be reflected on Form 8949 and Schedule D. How this is reflected depends on whether the sale is short-term (one year or less from the date the stock was acquired to the date it was sold) or long-term (more than one year from the date acquired to the date of sale).

Use IRS Form 8949 to calculate your capital gains and/or losses on Schedule D.

5

8

The total from Schedule D is

entered on line 6 of Form 1040.

For illustrative purposes only.

For illustrative purposes only.

Example: Short-Term Gains or Losses

Example: Long-Term Gains or Losses

4

4

Your Restricted Stock and Performance Awards

Frequently Asked QuestionsQ: What is new for this tax season?

A: The tax-reform legislation that took effect in 2018 changed the tax rates on income. In addition, the 2019 IRS Form 1040 tax return alters some of the prior filing rules, including those of capital gains or losses. For additional information, please review the content at What’s New This Tax Season?

Q: Why does my cost basis show up as zero?

A: Most restricted stock and performance share awards provided by a company do not require you to “pay” a price for it. Rather, they provide the award to you without cost. As a result, your cost basis is zero and reflected as such in your 1099-B because IRS rules do not let us adjust it. However, your employer will include the Fair Market Value (less any amount you paid, if any) of the award as com-pensation income on your W-2. Therefore, your Supplemental Information form issued by Fidelity shows the adjusted cost basis and adjusted gain/loss needed for you to properly file your taxes so you don’t overpay in tax.

Q: How do I determine if the capital gain or loss on the sale of my restricted stock, restricted stock units, performance shares, or performance units should be treated as long term or short term?

A: When you subsequently sell the shares received upon vesting/distribution, the difference between your sale price and your cost basis in the stock will be treated as a capital gain (or loss). If your holding period of the stock is longer than one year from the vesting/distribution date, your gain (or loss) will be treated as long term. If your holding period is one year or less, your gain (or loss) will be treated as short term and taxed as ordinary income. The sale proceeds are shown on Form 1099-B. If you received restricted stock and made a Section 83(b) election, you will need to consult your tax advisor to confirm when the capital gains holding period starts.

Q: Which form do I use to report my capital gain or loss?

A: You need to complete two forms: Form 8949, with its column totals going onto Schedule D (Form 1040) for the year in which you sold your stock; the totals from Schedule D then go onto line 6 of Form 1040. These forms are filed with your Form 1040 federal income tax return. This is required even when you are only selling shares to pay the taxes at vesting/distribution (or if you have no gain at sale beyond what already appears on your W-2).

Note: When you report the sale of the shares you acquired when your grant vested or was paid out on Form 8949 and Schedule D, you avoid double taxation by including its value at vesting/payout in the cost basis column. Any income you realized at vesting (or share payout after a tax deferral) is treated as compensation income, was already reported to the IRS on Form W-2 (or on Form 1099-MISC if you are a nonemployee, such as a director), and was included in your income for the year of vesting/distribution.

9Continues

4

4

Your Restricted Stock and Performance Awards

For specifics on what your company uses as fair market value, please see your plan documents, as the fair market value may vary. Fidelity does not provide legal or tax advice. The information herein is general and educational in nature and should not be considered legal or tax advice. Tax laws and regulations are complex and subject to change, which can materially impact investment results. Fidelity cannot guarantee that the information herein is accurate, complete, or timely. Fidelity makes no warranties with regard to such information or results obtained by its use, and disclaims any liability arising out of your use of, or any tax position taken in reliance on, such information. Consult an attorney or tax professional regarding your specific situation. Fidelity Brokerage Services LLC, Member NYSE, SIPCFidelity Stock Plan Services, LLC© 2020 FMR LLC. All rights reserved.710947.7.0 05/39411 RS-TAX-PDF-0120

Go to the Fidelity SPS Resource Center.

If you have any questions, a Fidelity Stock Plan Services Representative can help. Call 800.544.9354.

Frequently Asked QuestionsQ: What about when my grant vests/distributes over time?

A: When you have an award that vests/distributes in stages or portions (e.g., 25% a year or 25% for meeting certain targeted performance goals), each portion has its own tax basis that depends on its value at vesting/payout. Your tax basis is equal to the amount (if any) you paid for the shares plus the amount that was treated as compensation for each portion. Your capital gain or loss is the difference between the net sale price and your tax basis for each portion.

Q: Will I owe other taxes beyond federal tax when I sell my stock?

A: State and local taxes may also apply, and the rules governing such taxes may vary from federal income tax rules. Please consult your tax advisor for more information.

Q: How are dividend equivalents taxed?

A: When dividend equivalents are paid at vesting through additional shares or cash, these are reported as part of your ordinary W-2 compensation income and withholding applies at that time. With nonemployees, such as directors and independent contractors, this income is reported on Form 1099-MISC. The full value of the shares when received is their tax basis when you sell them. Should the cash-dividend payout occur earlier when shareholders receive dividends, this compensation income will be taxed and withholding applies at that time.