I spent the entire Presidents Day holiday struggling to get TurboTax Premier 2020 to recognize the correct adjusted cost basis for my ESPP sales. Even after entering the adjusted cost basis in the "I have all my info" dialog, the underlying Form 8949 did not show any adjustment and just used the original 1099-B cost basis to calculate the gain. I also tried the "Walk me through" dialog, and that ends the same way -- no adjusted cost basis in Form 8949. Ironically, in the first case when you enter the adjusted cost basis, it will say, "Good news: we've adjusted your ESPP cost basis for you," but no, they really didn't. And in the second "Walk me through" case, the message will say the cost basis is 0, but really, it'll still be the original 1099-B cost basis. In general, I think it's a good idea to View -> Forms and check the 8949 to see what TurboTax actually did.
I noticed that at the end of the dialog (either case), there will be a window with "Select any less common adjustments that apply," and here you can select the last one "An adjustment is required for a reason not already covered." If you select this, a box will open for you to enter an amount, where you can put in a negative adjustment amount for the income that was included on your W2. After doing this, I saw that Form 8949 showed this adjustment and calculated the gain correctly. The only thing is that the adjustment code (column f) is set to "O" (per IRS instructions: You have an adjustment not explained earlier in this column) instead of "B" (You received a Form 1099-B (or substitute statement) and the basis shown in box 1e is incorrect). On my return last year when TT actually worked, it shows "B" for this column in my ESPP sales with adjusted cost basis.
If Intuit does not fix this soon, I intend to go with this method of entering the adjustment. Does anyone see any problem with this?
