Deferred Compensation Stock Sale Basis

Forum|Forum|2 years ago
February 21, 2024
1 reply
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While working, I received stock over multiple years as part of a deferred compensation plan. Now retired, I sold some of the stock. On the 1099-B it is listed as "Non-Covered". What do I report as the tax basis? a) the stock value when it was awarded? b) the stock value when I retired? c) $0 because I actually paid nothing out of pocket for the stock?

ThomasM125

Since you paid nothing for the stock, the value when you purchased it would have appeared on your W-2 form as wages so you would have paid tax on it. You can consider that income as the cost basis of the stock that can be deducted from the sales proceeds to determine your capital gain income. So the cost basis of the stock is the value when you acquired it.

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