I've entered a sale of ISOs from my 1099-B (Short Term - Box A checked) into TurboTax. After doing so, it prompts me to adjust my cost basis, but I don't understand why I'd need to do that. I've read through this TurboTax article on ISO taxation: https://turbotax.intuit.com/tax-tips/investments-and-taxes/non-quali[product key removed]ns/L8zsxRi7...
If I go through the steps to my adjust cost basis and enter details about the ISOs, it comes back with a significantly inflated cost basis. Should I just be skipping this step by selecting "I don't want to adjust (not recommended)"? In what scenario would one need to adjust their cost basis as it relates to ISOs?
Including additional context about the ISOs.
Date of Grant: 01/2018
Number of ISOs = 1000
Strike Price = $1.85
Date of Exercise: 12/2023
Sale Price = $20
Date of Sale: 10/2024
