Phantom Stock

Report phantom stock as well as cash or stock received pursuant to a phantom stock plan in Schedule A. In addition, report your participation in the phantom stock plan in Schedule C, Part II. Report your spouse’s phantom stock interests in Schedule A only. 

Phantom Stock: Examples

For You

Schedule A

Report phantom stock if the value of the phantom stock was more than $1,000 at the end of the reporting period, or if the phantom stock produced more than $200 in income during the reporting period.

Block A: Provide the name of the employer and write “phantom stock.”

Block B: Report the value of the phantom stock by marking the appropriate column.

Block C: Write “cash” and the exact amount of income in the column labeled “Other Income” on the right side of the page. Mark the column labeled “None (or less than $201)” instead if (1) you received less than $201 in income or (2) you received income in the form of stock, rather than cash. Report any stock that you received as a separate line item entry, using the instructions in this guide for stock.

Schedule C, Part II

You also need to report your participation in a phantom stock plan in Schedule C, Part II.

Terms: Identify the plan as a phantom plan and describe its terms in detail. Among other details, you need to state what you will receive and when you will receive it. You also need to state any deviations from the normal terms of the plan that the employer will make for you. This includes any acceleration of payment, any waiving of vesting requirements, and any change in the form or timing of payment or eligibility.

Parties: Provide the name of the employer as well as the city and state in which the employer is located.

Date: Provide the month and year in which you began participating in the plan.

For Your Spouse

Schedule A

Report your spouse’s phantom stock in the same manner as described in the section titled “For You” above, except when reporting cash payments. Report a spouse’s cash payment only if the payment is $1,000, in contrast to the $200 threshold for reporting a cash payment to you. In addition, you do not need to provide the actual amount. Instead, write “spouse’s cash payment” in the “Other Income” column.

Schedule C, Part II

Do not report a phantom stock plan in which your spouse participates in Schedule C, Part II.

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This guide is not intended to provide investment advice, and you should not rely on statements in this guide when making investment decisions.