Tax reporting for stock plan transactions can be complex. Morgan Stanley is here to help, providing the communications, resources, and documentation you may need to navigate tax season.
Tax Resources Center & 2017 Tax Guide
For Tax Season 2017, we created one consolidated guide and posted it to the Tax Resources Center, which you can access via the link in the global header or a tab in the “Help” section of StockPlan Connect. The guide includes:
- The documents needed to file returns
- An explanation of cost basis calculations
- Steps for reporting a stock plan transaction
- Contact information for questions
- A glossary of terms you should know
The six tabs that make up the Tax Resources Center also contain much of the same information, in addition to a helpful Tax Season Support video. For a walk-through of the Tax Resources Center, click here
Extended U.S. Service Center Support for Tax Season
The Morgan Stanley Tax Reporting Service Center offers extended hours and will be open from:
- 8:00 a.m. ET to 10:00 p.m. ET, Monday through Friday
- Monday, February 6, 2016 – Tuesday, April 18, 2016
- 8:00 a.m. ET to 5:00 p.m. ET, Saturdays and Sundays
- Saturday, February 4, 2016 – Sunday, April 16, 2016
- The Morgan Stanley Tax Reporting Service Center can be reached at:
- 1-877-772-1099 or
2017 Tax Forms
Morgan Stanley will mail applicable tax forms by February 15, 2017. Morgan Stanley will also post these tax forms to the Documents section within your StockPlan Connect account; from there, you can select “All Types” or “Tax Documents.”
Domestic participants will receive separate 1099-Bs for the following transactions:
- Stock Option Exercises, Stock-Settled Stock Appreciation Rights (SSAR) Exercises, or Restricted Stock Release Transactions resulting in a sale of stock
- If your company is enabled for 1099 Relief, Stock Option Cashless and Sell-to-Cover (STC) Exercises are not subject to 1099-B reporting
- A Year-End Option Activity Summary will be sent under separate cover
- Sale of Employee Stock Purchase Plan (ESPP) shares
- Sale of Vested Restricted shares
- Separate Historical Transaction Summaries for ESP and RSS Accounts will be available in the Documents Section of SPC
- Sale Transactions for undocumented international participants will also be reported on Form 1099-B.
- Domestic participants will receive separate 1099-Div Forms as follows:
- Dividends paid ($10 or greater) on ESPP long shares
- Dividends paid ($10 or greater) on RS long shares
- Morgan Stanley will send all undocumented participants (both U.S. and non-U.S. participants) a 1099-Div reflecting any amount paid ($.01>)
- If a participant sold shares, the 1099-Div will be included in the 1099-B mailing.
- Dividends paid to W-8BEN documented international participants are reported on Form 1042-S.
Cost Basis Reporting
You can find an explanation for how to calculate cost basis on p. 4 of the “Tax Filing Basics for Stock Plan Transactions” guide.
For Tax Season 2015, Morgan Stanley will provide the Vesting Fair Market Value (FMV) for Restricted Stock Release non-covered STC/SAS transactions as the cost basis on the 1099-B, though we will not report this figure to the Internal Revenue Service (IRS). If covered (award price > $0.00), the award price will be reported as the cost basis.
Important Updates and Reminders
Effective January 1, 2016, the FICA max is $118,500.
The Medicare rate remains at 1.45%, as well as the Medicare surtax under the Patient Protection and Affordable Care Act. Morgan Stanley will continue to withhold the additional tax on Stock Option Taxable Transactions in which the participant’s wages are in excess of $200,000. The actual Medicare Tax obligation will be determined during your tax filing.
Please direct all inquiries to the Morgan Stanley Tax Reporting Service Center at 1-877-772-1099 or 1-801-617-7467, Monday through Friday from 8:00 a.m. to 10:00 p.m. ET. and Saturdays and Sundays from 8:00 a.m. to 5:00 p.m. ET.
Morgan Stanley Smith Barney LLC (“Morgan Stanley”), its affiliates and Morgan Stanley Financial Advisors or Private Wealth Advisors do not provide tax or legal advice. Clients should consult their tax advisor for matters involving taxation and tax planning and their attorney for legal matters.
CRC 1927531 11/2017