cashless exercise of stock option

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readtheform
Posts: 23
Joined: Tue Mar 09, 2010 4:42 pm

cashless exercise of stock option

Post by readtheform »

I am US Citizen and resident. I have stock options from a private Canadian company that have vested and they are in the money. I have been offered the opportunity to do a cashless exercise, where I am granted the number of stocks that, in the current valuation, are of the same total value as my vested stocks at the grant price.

Question: Do I have to file Canadian taxes if I accept this?
How are these treated in US taxes?

Thank you
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nelsona
Posts: 18675
Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Re: cashless exercise of stock option

Post by nelsona »

Exercising these options would be considered Cdn-source wages, requiring a Cdn tax return. The same income would be reported in US, with IRS giving credit for the Cdn taxes owed.

If the amount is less than C$10K, you can exempt these from Cdn taxes.
After 20 years, I am severely cutting back on responses. Do not ask specifically for my help. There are a few others on this board that can answer most questions. All the best
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