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Training detaik Curriculum

Nella sells shares of stock she acquired by exercising options granted to her under an employee stock purchase plan

$($ESPP$).$ Her employer did not offer the shares at a discount, so the price she paid when she purchased the stock was the fair

market value at the time. If Nella sells the stock for a profit in a qualifying disposition, how should the difference between her

basis and the sale price be reported on her tax return?

$$

Compensation income subject to income tax, as well as social security and medicare taxes.

Orcinary income.

Long$-$term capital gain.

Short$-$term capital gain.

Mark for follow up

Summary