I have NUA (net unrealized appreciation) stock from my employer which was distributed last year (Sept, 2022). I paid ordinary income tax on the cost basis, which was reported in Box 2a of my 1099-R. I have already sold some shares in 2023, so the difference between the cost basis and the value at the time of distribution is subject to LT capital gains while the difference between the value at the time of distribution and the value at the time of sale is subject to ST capital gains. TurboTax does not appear to have provision to handle this. In another thread, it was suggested to report the sale as both a ST and a LT capital gain, along with a note of explanation. An additional problem that I have is that the sale of NUA stock is NOT subject to the 3.8% Net Investment Income Tax (NIIT) per IRS rules, yet TurboTax ignores this and calculates the 3.8% NIIT. Am I missing something or does TT not have provision for this tax situation? If the latter, I can no longer be a TT user. Thank you in advance for any help.
