Question

RSU Sell-To-Cover - Single release statement vs 2 transactions in 1099-B

Forum|Forum|2 years ago
February 21, 2024
1 reply
0 views

Hi

I got a single release statement for my sell-to-cover transaction, but two different entries in my 1099-B.

273 shares vested = 177 shares sold and 96 shares sell-to-cover (these are the 2 separate entries in my 1099-B).

How do I treat those two entries in the 1099-B with respect to this screen. Thanks

RSUs are pretty straight forward; therefore, I recommend you enter your transactions without indicating you are reporting the sale of company stock. Indicating that is company stock has no impact on what's reported to the IRS. It only affects what screens and questions you get in the TurboTax interview. When RSUs vest (the stock is delivered) the entire amount is ordinary income. Your employer must collect payroll taxes, or sell shares to pay it. Since you are taxed on the entire amount, you basis is the amount that is added to your W-2 which you are taxed on. If you retain the stock, any gains on the sale will be short term if you hold the stock one year or less, and long term if you hold it more than one year.

Your cost basis is the total value on the date the RSUs vested. This is also the amount that it is added to your income and included in Box 1 of your W-2. To get your cost basis per share, divide the total value upon vesting (the amount added to your income) by the total number of shares represented by the RSUs.

You will have two transactions. The cost basis (per share) and acquisition date will be the same for both transactions, and they will both be short term. The proceeds and sales date will be whatever is reported on the 1099-B.

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"

S

sg11sgAuthor

Are you suggesting that the RSU screen then won't even come into the picture? I read some previous posts pointing to this RSU screen. Is there a way to treat this as a proper RSU sale, and yet achieve the goals you mention in your reply? Also, do I have to enter the taxes withheld for the RSU (i.e the sell to cover)?

D

DavidD66

Yes, I am suggesting that you bypass the RSU screen. In my opinion it just unnecessarily complicates the situation and is not helpful as long as your employer reported the RSUs vesting as income and withheld and paid the necessary taxes. I don't know what you mean by "proper RSU sale". The RSUs vested, stock was issued and sold. The RSUs vesting is a taxable event reported on your W-2. The two sales of the stock issued are investment sales reported on 1099-B that need to be reported on your tax return just like any other stock sale.

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"