Taxes and tax filing

Shares of stock received or purchased through a stock plan are considered income and generally subject to ordinary income taxes.1 Additionally, when shares are sold, you’ll need to report the capital gain or loss. Learn more about taxes, when they’re paid, and how to file your tax return. You may want to talk with a qualified tax advisor about your specific situation.

How stock compensation and stock purchase plans are taxed

When you pay tax—and how much—depends on your stock plan and what you did with your shares. See which activities trigger taxes and what gets reported by your company and you.

Understanding stock plan taxes (PDF)

Tax withholding

Because stock plan shares are considered income, ordinary income and FICA taxes2 apply. Your company reports these amounts on your W-2 for tax-filing purposes.

Starting January 1, 2022, following a participant's separation from employment, Johnson & Johnson will withhold state income taxes based on the participant's last work state (and not solely based on residence state).

See an overview of withholding methods (PDF)

Tax-filing guides and on-demand workshop

We'll help you understand which documents to gather and how to read—and use—the tax forms you'll receive from Fidelity. To learn more, watch this on-demand workshop or jump to the appropriate tax-filing guide below for step-by-step instructions to prepare for filing. If you’re not sure which plan you're in, log in to NetBenefits®Log In Required and look for your stock plan on the home page.

During tax season

Fidelity provides you the tax forms you’ll need based on what you did with your stock during the prior year. Be sure to wait until you receive all your forms and documents before you file.

You can view your personal tax form schedule to see what forms to expect and when.

No more waiting. Sign up and get notified as soon as your tax forms and documents are available online.

Use the right cost basis to avoid overpaying taxes

Cost basis is just a fancy term given to the purchase price paid to acquire shares—and it’s used to determine the gain or loss when those shares are sold. For stock plans, your cost basis may need to be adjusted to reflect the compensation income you already reported and paid tax on. But don’t worry—Fidelity will calculate your cost basis and provide it on the tax forms you receive.

Related resources and actions

What's new this tax season (PDF)

Highlights of key IRS tax changes to be aware of when preparing your tax return.


Tax-filing FAQs

Learn from these frequently asked questions posed by other tax filers.


Tax calculators & tools

Help you to assess and calculate the tax implications of your investments.


Tax preparation offers

Do you self-file using tax preparation software? Get discounts courtesy of Fidelity.


Stock plan glossary

What’s that word? Find definitions for commonly used terms.

Fidelity Learning Center

Strengthen your knowledge on a range of topics from personal finance to investing.

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