Question

Cash & Stock Settled RSUs for company acquisition

Forum|Forum|4 years ago
April 8, 2022
1 reply
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Hi,

My company got acquired in 2020, and the vested RSUs that I had got converted to a combination of stock and cash per terms of the merger. In 2020 tax return, I paid the ordinary income taxes on settled total, as they were all reported on my 2020 W-2.

I sold the stock in 2021, with capital gains. The form 1099-B from the broker correctly reports the cost basis for the stock (the price at the closing date), but there is nothing in it that reflects that these were RSUs. I am trying to figure out how to enter this transaction into Turbotax but the questions that are being asked by Turbotax regarding RSUs don't seem to consider my situation. I would much appreciate any help.

Thanks!

R

RaifH

You can treat this as a normal sale of non-employee stock in TurboTax.

If the income and taxes were reported properly on your 2020 W-2 from the stocks and cash you received, you do not need to indicate that those stocks were RSUs now that you are selling them in 2021. The cost basis should be their value when you acquired them in 2020, which it sounds like it is. The holding period will be determined based on whether you held them longer than a year. If so, they qualify for long-term capital gains treatment.

B

backwardentropyAuthor

Thank you! Somehow, through the questions that I had answered, Turbotax has generated an "Employee Stock Transaction Worksheet" for this 1099-B, and has written "not employer stock" for the company name. In line 10 of the same form, item d was also checked "Restricted Stock Units", which I managed to uncheck. Is there any way, without deleting and redoing this 1099-B, to remove this worksheet (which seems to be filed along with the return), or is it ok to just leave it as is?

Thank you again!