You just need to report the sale and cost information reported on your Form 1099-B for the year. The shares sold to pay taxes should be included with the sales listed on your Form 1099-B in the year they were sold. The discount on the shares sold will be reported on your W-2 form in box 1. You may need to adjust the cost basis reported on your Form 1099-B to include the discount, as often the 1099-B form will just report what you paid for the shares and not include the discount.
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