How to un-bundle stock sales that include ESSP(300 shares) and RSU(200 shares)? UBS bundled all 500 shares in one import. But Turbox tax allows 1 type for a import.

[ranchohiker]

I am retired and don't have W2.  Those ESSP and RSU were granted more than 10 years ago.  I know portion of granted RSU shares were traded to pay tax at the time it was vested.

[TomYoung]

"Those ESSP and RSU were granted more than 10 years ago."

So clearly you have a sale reported to you on a 1099-B as noncovered. 

" I know portion of granted RSU shares were traded to pay tax at the time it was vested."

COMPLETELY AD UTTERLY IRRELEVANT.  Put that out of your mind.

There's no problem at all with reporting that sale as 200 shares and 300 shares, with the same date of course and the proceeds split properly.

The sale of the RSU shares is dead simple.  You report the sale and simply enter the correct basis.  The correct basis for each lot sold, stated as a "per share" number, is the per share "fair market value" of the stock used by your employer to calculate the compensation created by the vesting.  So, for example, if 50 of those 200 shares vested on April 1, 2009 and the per share "fair market value" used by you employer was $20 per share then those shares contributed a basis to your 200 share trade of (50 x $20) #1,000.  You just tote up the numbers of the various lots and enter that as the basis for the 200 shares.  (Make sure you prepare a paper copy of your analysis and staple it to a paper copy of your "as filed" income tax return, just in case the IRS ever asks "how'd you come up with that basis?").

The sale of the ESPP shares needs a little more work.  Although the sales of these shares are clearly "qualified" sales - sold at least 2 years after the grant date and 1 year after the date of acquisition - those sales CAN create reportable compensation income and that compensation income and that compensation income gets added to your "out of pocket" (discounted) price in calculating gain on sale.  The easiest way of dealing with this is to use the ESPP "guide me step by step" process, entering your Form 3922 information and letting TurboTax handle the calculations.  Be sure to go to the very bitter end of the "Stocks, Mutual Funds, Bonds, Other" interview.  Don't simply stop when you are finished entering your trade information.  Eventually you'll get to a page titled "Your Employee Stock Plan Results" where you'll be asked if the compensation TurboTax has calculated has been included on your W-2.  You'll answer "No" and TurboTax will make the needed entry.

Tom Young

[ranchohiker]

I have 500 shares(300 shares of ESSP, 200 RSU) in one import item from UBS.
I followed your instruction on use “guide me step-by-step”.  When I got the question “What type of Employee stock plan was this sale from?”, I anwered “ESSP”, then followed the “walk me through adding more info” instruction to enter the details for the 200 share of ESSP.  When I tried to enter more sale lots, Turbotax still considers the lot is for ESSP, I can’t change the new lot to RSU.    How do I enter the details for RSU shares when it’s imported together with ESSP sales from UBS.    I went all interviews through the “your Employee stock Plan Result” page and answered “No”.  But, I still didn’t get any interview to enter the 300 RSU shares that bundled with this import from UBS.   How can I enter this RSU portion which is part of an import together with ESSP sales?

[TomYoung]

BREAK the sale into 2 parts, "as if" they were two different sales..  That was the first sentence of my answer:  "There's no problem at all with reporting that sale as 200 shares and 300 shares, with the same date of course and the proceeds split properly."  There's no need to slavishly follow the reporting on the 1099-B as long as you report your income correctly.

You should be able to edit the trade you have worked on to "boil it down" to the 300 share portion, all ESPP.  

There's no need to use the RSU guide me step by step process IF you know your basis.  The only reason I suggested using the ESPP guide me interview for the 300 shares is that the sale of those shares can create compensation (which gets added to the "out of pocket" basis) and the ESPP will handle that nicely, posting the compensation (if any) to the correct line of Form 1040 and adding that to the out of pocket cost for each lot.

But the sale of the RSU stock DOESN'T create compensation - that all happened at the vesting 10 years ago - so it's easier and faster to enter those stock sales directly, providing the correct basis.

[ranchohiker]

Tom, thank you for your feedback.  Just to make sure I understand your answers.  Are you saying that I should just delete the import from UBS, and manually enter the sales?

[TomYoung]

I believe you could probably edit your existing trade, reducing it to the 300 ESPP shares sold and then manually add the 200 share RSU trade.  But it's also entirely possible, maybe even easier, to simply delete the trade entirely and enter manually two trades.

[ranchohiker]

Tom, you are correct.  I could do either way.  Thank you.