Recently I got mail from IRS stating that I had underpaid taxes for a prior year. My company paid a part of my salary via RSUs and used Morgan Stanley to manage my account. Whenever my stock vested Morgan Stanley sold one third of my stock to pay taxes. Apparently Morgan Stanley has sent a 1099 to IRS where they had reported the stock they sold to pay taxes on my rsu vesting as income. I always thought that my W2 had my full income including my RSU vest and taxes which included the stock Morgan Stanley sold to cover my taxes on my rsu which was already in my W2. Am I not correct? My W2 only has the total tax withheld. It doesn't give a break down of how much was the money withheld from my salary and how much was the money that was part of the RSU sale. I just inputted the W2 info and other 1099 into turbotax but never inputted Morgan Stanley 1099 since I just saw that as holder of my stocks and never did any trading there. What can I do to rectify the situation?
