RSU Cost Basis Not Displayed

Question

Hi all. I sold stock this year, some were RSU's and others were ESPP. I connected my brokerage with TurboTax and it prefilled all the information. However, the cost basis section is not completed. On line 1e for my 1099-B, the cost basis is completed for my ESPP shares sold, but left as $0.00 for RSU. How do I add this correctly in TurboTax? If I put $0 does that mean I am taxed on the full amount? Would I be paying tax twice as I already paid tax when they vested in my paycheck?

ThomasM125 · Accepted Answer

I suppose I'm an expert on this topic, since I've had to do it two years in a row. And I'm again not happy with the decision my husband made to not sell at the time of vesting, but that's another story. The stock tanked and we lost so much money, plus had to pay out of pocket for taxes, on the original amount vested. Lesson learned, and since then sell every time vested.

But to answer your question, you need to go to the brokerage website to find the actual cost basis. last year I called E-trade and they told me how to locate the info. This year I found it on my own. In 2024, we sold several stocks from different purchase dates at one time so I listed all the sales for that day using the sum of Box 1d - total proceeds. I suppose you could still do that if you sold throughout the year. The cost basis on your 1099-B Box 1e will be marked as 0. You will need to place a Check Mark for "I need to adjust my total cost basis." In my situation, we had 54 line items. I entered each individual cost basis on a spreadsheet and then entered only the TOTAL adjustment. Make sure you make it a negative. I also clicked item B noting the cost basis incorrect.

If you happened to sell ESPP, that needs to be a separate sale and usually the cost basis is covered so it will be on the 1099.

Good luck!!

Yes, you would be double counting income if you entered $0 for the cost basis on restricted stock units (RSU's). That is because the value of them that you did not pay for is taxed to you as wage income in the year they vest. So, that income plus what you paid for them, if anything, would be your cost basis when they are sold.

For the employee stock purchase plan (ESPP) stock, ordinary income will be reported to you as wage income in the amount of the discount you received when you acquired the shares. It will be reported in the year you sell the shares, so in your case you will have ordinary income in box 1 on your W-2 form for the ESPP shares sold in 2024, but not necessarily on the RSU's, as that income would be reported in the year they vested.

For your Form 1099-B entries in TurboTax, you should enter the RSU's and ESPP stock sales separately and the program will help you calculate the adjustment that needs to be made to the cost basis reported on your form 1099-B. This will entail entering information from the form 3922 in the case of ESPP stock and entering the ordinary income reported upon vesting of RSU shares.

For the ESPP shares sold, the ordinary income from the discount will be reported on your W-2 form, so you could take that amount and divide it by the number of shares sold to arrive at the discount per share. If you know what you paid for the shares, as listed on the Form 3922, the correct cost basis for the Form 1099-B entry would be that cost per share plus the discount per share times the number of shares sold. If you know what the correct cost basis is, you can just enter that rather than choose to have TurboTax help you with the calculations.

For the RSU shares, the correct cost basis will usually be what was included in your wages upon vesting, since you probably didn't pay anything to acquire them.

DavidD66 · Answer

For Employee Stock Purchase Plans (ESPP) I strongly recommend that you enter those manually and be sure to indicate that you sold Employer's Stock.

For the RSUs, you need to adjust the cost basis. As you mentioned, you were taxed on the full amount of the RSUs when they vested. Because they have already been taxed, your cost basis is the same amount that you was included in your wages reported in box 1 or Form W-2. On the screen above, you would click on the box with "The cost basis is incorrect or missing on my 1099-B". On the next screen you will enter the correct cost basis (the amount included in your W-2 income). It should be very close to, if not exactly the same as the proceeds amount on your 1099-B, resulting in a very small (or no) gain or loss.

Form more information about Employee Stock Purchase Plans, see the following TurboTax article: Employee Stock Purchase Plans