On May 1, year 1, Anna received 5,000 shares of restricted stock from her employer, Jarbal Corporation. On that date, the stock price was $5 per share. On receiving the restricted stock, Anna made the §83(b) election. Anna's restricted shares will all vest on May 1, year 3. After the shares vest, she intends to sell them immediately to purchase a condo. True to her plan, Anna sold the shares immediately after they were vested.
a. What are the tax consequences of these transactions to Anna in year 1?
b. What are the tax consequences of these transactions to Anna in year 3 if the stock is valued at $1 per share on the day the shares vest?
c. What are the tax consequences of these transactions to Anna in year 3 if the stock is valued at $9 per share on the day the shares vest?
d. What are the tax consequences of these transactions to Anna in year 3 if the stock is valued at $5 per share on the day the shares vest?