My employer gave me stock and added some odd dollar amount as taxable on my paycheck...why?

Question

My employer gave me stock and added around $6000 to my taxable income on my paycheck. I don't understand how they can come up with a dollar amount since I have not sold the stock. In my opinion (which obviously doesn't mean much), I shouldn't get taxed on the stock until it's sold. By the time I sell the stock it might be worthless, but I've already paid taxes on it. Just curious. No one at my job has been able to explain why they've done this.

Answer 1

This is very simple, stock has a value on issue, and this is seperate from its "market" value.   If this is issued as a benefit or compensation, its value must be taxed as "income".

This is different then the capital gain you would realize on the sale of the stock, which is what you are talking about.

Answer 2

all bonuses are taxed at the time given.They were given at par value

Answer 3

File the papers where you can find them. You will need to know the amount ($) per share if you sell some or total $ if you sell all later. If you cannot find this information you may be taxed again when you sell the stock. The money they taxed you on will be your "Cost basis" for the stock. If you sell it for more the additional amount is a taxable capital gain, if you sell it for less it is a capital loss and can be used to offset capital gains.