"W2 income box 2 does not include proceeds from 40 shares sold. It only shows my paycheck withholding amount"
At a guess, the taxes withheld ARE included in the various "taxes" boxes of your W-2 as that's the proper reporting. Cash raised from the sale of stock "for taxes" is passed back to the employer, who pays the government(s), and scatters the amounts around your W-2 as appropriate. Typically this is not disclosed to you on your W-2, unlike the income created by the vesting.
The place to put this to bed conclusively is to call the payroll department and ask IF THE TAXES ARE INCLUDED on the W-2.
Usually people raise this issue when they sell the stock and see the "Refund-O-Meter" at the top of the screen change dramatically for the worse, and that's a sure tip-off that they've used the wrong basis for the stock, but you say that you know the correct basis so that's not the issue here. So I'm going to bet, and give you odds, that the taxes ARE included on your W-2.
Absolutely NOTHING you do using the RSU step by step process will give you "credit" for taxes withheld. All that happens when you enter shares in the "shares withheld for taxes" box is that those shares get subtracted from the "shares vested" to come up with a "shares available for sale" number. There's no "dollar" effect going on.
Tom Young
