With employees of all kinds streaming into the technology sector over the past few years, it was inevitable that misunderstandings about stock options and taxes would ensue. Zerkel never sold the stock. He said he didn't realize he would be on the hook until January when he surfed the Web and read about other people's tax problems. It wasn't presented to me as a problem, even a potential problem. It was, you are going to get a lot of money or a little money.
People have enough trouble understanding taxes.
Martin Scully, an attorney adviser in the IRS chief counsel's office, said many people could have avoided these kinds of tax problems by selling their shares by the end of the calendar year in which they bought them. In that case, workers would pay regular capital gains taxes but not the complex alternative minimum tax. A lack of planning can really exacerbate it. But for people like Zerkel and Oppenheimer, who did not sell their shares by Dec. 31, little can be done now, according to Jonathan Forster, a tax-planning lawyer in Tysons Corner. Some people are so in the hole and owe so much tax that unless they can figure out a payment plan there's little between them and bankruptcy.