RobertB4444
Expert Alumni

Get your taxes done using TurboTax

When you took the NUA your shares were supposed to be placed into a retirement account, not a brokerage account.  At the time that you took the NUA you were to pay all the taxes on the basis that you held in the stock and the tax advantage is that you would only have to pay capital gains tax on the distributions from the retirement account instead of regular income tax as the stock was sold.

 

Since you transferred the stock to a brokerage account instead of a tax advantaged account you lost the tax advantage to the NUA.  In addition, the brokerage that you are dealing with isn't going to have had any experience with a NUA transfer and they aren't going to be able to help you.  They are correct that you get a step up in basis due to the passing of your spouse, however.  

 

Here is an article on NUA from the IRS.  It's kind of jargon-y but it gets the idea across.

 

Very sorry for your loss.

 

@Romper 

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