I have been carrying a number of exercisable incentive stock options and I have begun to exercise those recently as I am seeking new employement (options are lost once employment is terminated). My question is, how are these gains taxed and at what rate ? I have exercised options in the past two years, one in which I had a CPA prepare my returns and this past year I did my tax returns. It was unclear to me how this impacted the tax I paid as Schedule D only appeared to show a slight loss for the commission paid on the transaction. I bought and sold within a few days period.