When you enter your 1099-B information for your stock option
transaction, do not select the Import option. Instead, select "I'll
type it in myself". Click on Continue. On the next screen, select your broker and click on Continue.
Next select the categories of trades reported on your 1099-B and click
Continue. Enter the information reported for your sale just as it is on
the 1099-B and then check the box below the transaction that says "This sale involves an employee stock plan (including ESPP) or an uncommon situation" then click on Start now.
Continue through the interview to enter the information for stock
options. You should have received a statement from your employer or the
broker that manages your company's plan. You will need that
information. If your options were Incentive Stock Options (ISOs) then
that would be Form 3921.
After entering the transaction, the cost basis for your stock should be adjusted to reflect the amount that was reported on your W-2 as income. This will result in your option transaction being properly reported and the income will not be doubled.
