you have given me more info. orginally, I thought you were taking a partial distribution and thus did not satisfy the NUA rules
however, if you are retired meet the NUA criteria and have employer stock in your 401(k), under the NUA rules, you can consider rolling only the stock into a brokerage account. The rest can go into an IRA tax deferred.
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additionally, the NUA rule cannot be used if they roll the stock over to an IRA and then liquidate it.
and you are taxed as on the cost basis of the stock distributed in kind in the year in which it is taken.
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here's more info i copied from another website
As a result, the best practice for NUA distributions is to really scrutinize the cost basis of the employer stock inside the qualified plan, and if necessary cherry pick only the lowest-basis shares for the NUA distribution to ensure the most favorable tax consequences. Fortunately, the NUA rules do allow such flexibility – to take some shares in-kind, and roll over the rest – but that still means it’s necessary to actually do the analysis to determine whether or how many of the NUA-eligible shares should actually be distributed to take advantage of the strategy (or not)!
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thus, consulting a tax pro is advisable.
