Need help finding where to enter Form 3922 (Section 423) on FreeTaxUSA for my employee stock purchase plan

Thanks for this explanation, but I'm still confused. So I don't actually enter the form itself, just the information from it? And where exactly in the "Other Income" section do I put this? Is there a specific field for stock purchase plans or do I just add it as miscellaneous income? Also, if I haven't sold any shares yet, do I still need to report anything this year?

You're correct - you don't enter the form itself, just the information from it. In FreeTaxUSA, go to the Income section, then look for "Stock" or "Investments." There should be an option for "Stock Options" or "Employee Stock Purchase Plans" - it might be labeled differently but look for those keywords. If you haven't sold any shares yet, you may still need to report the bargain element (the discount you received) as ordinary income on your tax return. Check box 8 on your Form 3922 - if the exercise price (what you paid) was less than the market value on the purchase date, that difference is taxable income this year even if you haven't sold the shares.

How does this taxr.ai thing work exactly? Does it actually fill out the forms for you or just tell you what to do? And is it secure? I'm always nervous about uploading financial documents to websites I don't know.

Sounds interesting but I'm skeptical. Does it work with all tax forms or just certain ones? I have a bunch of other complicated stuff on my return this year - rental property, some crypto trades, and a side business. Would it help with all that?

It doesn't fill out the forms for you - it analyzes your documents and gives you specific guidance on where to enter everything in your tax software. You still do the actual data entry yourself. They use bank-level encryption for all uploads and don't store your documents after analysis, so it's quite secure. It works with most common tax forms and situations, including the more complicated scenarios you mentioned. I know several people who've used it for rental properties and business income. For crypto, they have special tools to handle those transactions correctly since that's a common pain point for many tax filers.

Wait, how does this even work? I thought it was impossible to get through to the IRS these days. Last time I tried calling about a tax question, I was on hold for over 2 hours and then got disconnected. Does this service actually guarantee you'll speak to someone?

Sounds like a scam to me. Why would I pay a third party to call the IRS when I could just do it myself? And how do they get you through faster than anyone else? I doubt the IRS gives special treatment to certain callers. Has anyone else actually tried this?

The service essentially maintains your place in line so you don't have to stay on hold yourself. It uses an automated system to navigate the IRS phone tree and wait on hold, then calls you when an actual agent is on the line. It's not giving you special treatment - you're still in the same queue as everyone else, but you don't have to waste hours of your day listening to hold music. It's definitely not a scam - the service is just handling the frustrating hold time for you. Think of it like having someone wait in line for you. You're still talking directly to the IRS yourself when they connect you. I was skeptical too, but when I got an actual IRS agent on the line who answered all my questions about Form 3922, it was worth every penny for the time saved.

Thanks for this tip! One question though - when you say "the taxable amount (the discount you received)" - how exactly do I calculate that? My form shows several different dates and prices, and I'm not sure which ones to use to figure out what's taxable.

The taxable amount is the difference between what you paid for the stock (exercise price - box 3 on Form 3922) and the fair market value on the purchase date (box 4). Basically, if your company let you buy stock for less than it was worth on the market, that discount is considered compensation income. For example, if you purchased shares at $40 each when they were actually worth $50 on the market, that $10 per share difference is taxable income. Multiply that difference by the number of shares you purchased (box 5) to get your total taxable amount.

That's what I ended up doing too. After struggling with FreeTaxUSA for this form, I switched to H&R Block online which had clear instructions for employee stock purchase plans. But it did cost about $70 more than FreeTaxUSA, which kind of sucks.

But doesn't TurboTax cost like $100+ more for the version that handles investments? That seems like a lot just for one form. I'd rather figure out FreeTaxUSA if possible.

Thank you!!! This worked perfectly for me. I just called their support line and got through in about 5 minutes. The rep walked me through exactly where to enter the Form 3922 information. For anyone else struggling, here's what they told me: 1. Go to Income > Miscellaneous Income 2. Select "Other Income not reported on a 1099-MISC/NEC" 3. Description: "Employee Stock Purchase Plan - Form 3922" 4. Amount: The difference between box 3 and box 4 multiplied by box 5 Super easy once you know where to look!

I'm the original poster and just wanted to say THANK YOU to everyone who responded. I ended up calling FreeTaxUSA support as suggested here, and they helped me get everything entered correctly. Such a relief to have this figured out! For anyone who finds this thread in the future with the same problem, the miscellaneous income approach worked perfectly. And I'm definitely bookmarking some of these services mentioned for next year when I'll have to deal with selling some of these shares. Thanks again to this awesome community!