You should be able to get supplemental information from Fidelity if not already received it.
If the cost basis shown is $0, you just need to make the adjustment while entering the transactions so that you don't pay tax on the same income again. Box 1 of your W-2 should include the income and Box 2 includes the taxes paid already.
The cost basis of an NQSO sale reported on the 1099-B doesn't include the stock's discount. Since you have paid taxes on the discount (also called the compensation, taxed as ordinary income), you need to make an adjustment in the cost basis when entering the 1099-B transactions.
Follow these steps to adjust the cost basis:
- On the Let's get the details about this sale from your 1099-B screen, select Nonqualified Stock Options (NQSO) from the first dropdown at the top.
- Fill out the other fields on that screen, and when you get to the last field for box 1e, enter the cost basis from your 1099-B and be sure to put a checkmark in the cost basis is incorrect right below it. Then continue.
- On the following screen, select the middle option, I know my cost basis. Then enter the correct cost basis from your W-2 (the box 12, code V amount).
- Select Continue and the transaction will now reflect the corrected cost basis.
For more details, please see this help article.
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