here is how

The basis = market price X # of shares on your purchase day.

 

Your basis = 40*200=8000

e.g. you actually paid for $10/sh while mkt price is $40.

your actual cost = 200*10=2000

w-2 income = (40-10)X200=6000, reported in your box 1 of w-2. in another word, 6000 is not your basis. it's
your W-2 income earned from your purchase discount.


you sold it later for more than $40/shr, say $45/shr, your proceeds is 45*200=9000.

your capital gain in this case = (45-40)*200=1000, which you need to report on form
8494 of sch D.

Follow me?

I am not tax professional.  reference only.