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bachmj
New Member

For ESPP shares bought in 2017 (sold in 2019) my 1099 form has a cost basis listed. I received a supp. form that has a higher adj. cost basis. Which one should I use?

The ESPP shares were acquired at a 10% discount in 2017.  I do not believe I ever had this discount appear as income on any W2.
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6 Replies
RobertG
Expert Alumni

For ESPP shares bought in 2017 (sold in 2019) my 1099 form has a cost basis listed. I received a supp. form that has a higher adj. cost basis. Which one should I use?

When you sell ESPP stock you should receive both a 1099-B and a Form 3922.

 

To report ESPP sales in TurboTax:

  • When you enter your 1099-B information you will be asked: 'Do these sales include any employee stock? This includes ESPP, RSU, RS, NQSO, and ISO' Say yes.
  • Then you will be asked 'What type of investment did you sell?' Select ‘Employee Stock Purchase Plan, (ESPP) '
  • Check the box that says 'The cost basis is incorrect or missing on my 1099-B'
  • Then select 'I need help figuring out my cost basis
  • You will be prompted to enter your ESPP and Form 3922 information.
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jdub_SD
New Member

For ESPP shares bought in 2017 (sold in 2019) my 1099 form has a cost basis listed. I received a supp. form that has a higher adj. cost basis. Which one should I use?

and which version of turbo tax asks that question??  my version (Deluxe) doesn't.  However in the Guide Me Step-by-Step button it appears to suggest it'll ask a question if you select "uncommon situations" however there is no question on ESPP sales.... 

For ESPP shares bought in 2017 (sold in 2019) my 1099 form has a cost basis listed. I received a supp. form that has a higher adj. cost basis. Which one should I use?

@jdub_SD 

"and which version of turbo tax asks that question??"

You need to pay up to the Premier version of TurboTax in order to get the ESPP "guided" interview for the sale of the stock.  You won't have to upgrade as you certainly can get your stock sales correctly entered using the "plain vanilla" 1099-B stock sale interview since the broker has given you the correct basis to use in that supplemental information.  But maybe you'll want to upgrade anyway, depending on your situation.

 

If you don't upgrade you'll simply enter your sales exactly as they read on the 1099-B and then use the process TurboTax has in place to, in effect, state "the 1099-B reported by the broker is incorrect, so here's the correct basis." 

 

In your original post you said "The ESPP shares were acquired at a 10% discount in 2017. I do not believe I ever had this discount appear as income on any W2." 

 

With shares acquired via an ESPP it's the sale of the stock that can generate reportable compensation income, so if your sale did create compensation income - which I'm guessing is the case here - and that income didn't show up on a W-2, then in addition to entering your stock sale you'll also need to enter the compensation as an addition to your ordinary income.  (ESPP-related compensation is typically reported in Box 14 of the W-2 but it's not uncommon for employers to not report this compensation in the case of "Qualified Dispositions", which could, possibly, be your situation.)  Using the ESPP guided interview if you upgrade will post this compensation income if you go to the very bitter end of the "Stocks, Mutual Funds, Bonds, Other interview.  You can't simply stop the interview when you're done entering your sales information.

 

However, there's other ways of getting the compensation entered into your income tax return that don't

 

 

kehaynie
New Member

For ESPP shares bought in 2017 (sold in 2019) my 1099 form has a cost basis listed. I received a supp. form that has a higher adj. cost basis. Which one should I use?

WARNING: This calculation of the cost basis of ESPP stock appears to have a bug in it.  It keeps calculating my cost basis as 0 even though I KNOW I paid for it.

For ESPP shares bought in 2017 (sold in 2019) my 1099 form has a cost basis listed. I received a supp. form that has a higher adj. cost basis. Which one should I use?

Good catch. I have the same problem as well. I hope Intuit employees face it too when they do their taxes!

dave1809
New Member

For ESPP shares bought in 2017 (sold in 2019) my 1099 form has a cost basis listed. I received a supp. form that has a higher adj. cost basis. Which one should I use?

turbotax 2020 Premier is calculating adjusted cost basis of "0".  turbotax is broken for ESPP.  

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