In 2005, Collies Exercised an Incentive Stock Option (ISO), Acquiring

question 71

Multiple Choice

In 2005, Collies exercised an incentive stock option (ISO) , acquiring 150 shares of stock at an option price of $75 per share (fair market value at the date of exercise was $130 per share) . In 2014, the rights in the stock become freely transferable (fair market value is still $130 per share) . Which of the following statements is incorrect?

• A) Collis has no AMT adjustment from the ISO in 2011.
• B) Collis has no taxable income from the ISO in 2011.
• C) Collis has an AMT basis of $19,500 in the stock.
• D) Collis has an income tax basis of $11,250 in the stock.
• E) All of the above are correct.

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Definitions:

Newborns

Infants from birth to about 2 months of age, characterized by rapid physical growth and development in the initial stages of life.

Miscarriage

The spontaneous loss of a pregnancy before the 20th week, often due to underlying health issues or genetic problems.

Stillbirth

The death of a baby before or during delivery.

Preeclampsia

A pregnancy complication characterized by high blood pressure and signs of damage to another organ system, often the liver or kidneys.