I sold stock a mix of RSU, ESPP, and dividend reinvestments. I first transferred to a new bank, they are long term. I only have one 1099-B. How do I split this to enter?

[rehrenbard]

I have already calculated the proportion sold from each source (there are partial stocks). I think entered this in turbo tax as 3 sales -- proportionally breaking the amount sold into three sales and when I acquired each. However the RSU and ESPP are both showing a $0 cost basis and then isn't counting the gains at all in my taxes. What am I missing?

[DavidD66 · Accepted solution]

It is fine to enter your sales transaction as multiple sales, it the totals on the 1099-B reported to the IRS that need to match.    

For stock acquired from an Employee Stock Purchase Plan (ESPP) the most advantageous holding period is more than two years from the date of the initial grant.  This would be considered a Qualified Disposition.

When you sell stock acquired from an  (ESPP) the discount that you received when you bought the stock is generally considered additional compensation to you, so you have to pay taxes on it as regular income.

If you hold the stock for less than a year before you sell it, any gains will be considered compensation and taxed as such. If you hold the shares for more than one year, any profit (over and above the compensation component) will be taxed at the usually lower capital gains rate.

How much of your profit is considered compensation and how much is capital gain depends upon whether or not your sale is a qualified disposition or a non-qualified disposition.  If you sell the stock within two years after the offering date or one year or less from the exercise (purchase date) it is a Disqualifying Disposition.  For a detailed explanation of this, see https://turbotax.intuit.com/tax-tips/investments-and-taxes/employee-stock-purchase-plans/L8NgMFpFX.

RSUs are much simpler.  When RSUs vest (the stock is delivered) the entire amount is ordinary income.  Your employer must collect payroll taxes, or sell shares to pay it.  Since you are taxed on the entire amount, you basis is the amount that is added to your W-2 which you are taxed on.  If you retain the stock, any gains on the sale will be short term if you hold the stock one year or less, and long term if you hold it more than one year.

TurboTax has an interview for the sale of company  stock.  Do not import you Form 1099-B with the sale of the ESPP or RSU stock.  Instead, enter it yourself.  To do so in TurboTax, (if using Online be sure you are logged in to your return): 

• Click on Search
• Type “1099-B“ in the Search Window and hit Enter
• Click on Jump to 1099-B
• Click on + Add More Sales
• Answer Yes to: "Did you get a 1099-B or a brokerage statement for these sales?"
• Click on "I'll type it in myself"
• Enter your Brokerage name
• Answer Yes to "Do these sales include any employee stock?"
• Click the box to indicate the number of sales. 
• Click Continue on screen with "We strongly recommend entering your sales from [Brokerage] one at a time"
• Continue on the screen with "Now we'll walk you through entering the info on your [Brokerage] 1099-B" and enter the details of your stock sales.

[rehrenbard]

Thank you @DavidD66 - so first on the simpler RSUs, I have done exactly what you said:

 - Said I'd type my 1099-B in myself

 - Instead of entering the full 242 shares sold, I entered only those attributed to RSUs as 163.831 STOCK NAME

 - I think entered my proceeds as proportional to this sale (163.831/242)*total proceeds

 - I also entered the proportional cost basis but said I need to be walked through calculating it

 - I received these RSUs as part of 3 separate grants. I entered the 2 in full that were used, and then the proportion of the third grant sold here as 126.5668 and the proportional taxes withheld.

It seems to accept this, but then in the summary puts $0 as the cost basis, and even though it shows the entire value of the proceeds as gains, it doesn't include ANY of this in the summary of my income.

What am I doing wrong?!

[DavidD66]

It's hard to troubleshoot these things when you can't see what is going on with the tax forms an supporting schedules.  You might want to go ahead and pay for your return without filing.  This way you can view your tax forms and schedules by printing as a pdf.

For your RSUs, since you have calculated your cost basis, instead of going through the company stock interview, just enter as a regular sale of stock.  Enter the cost basis that agrees with your 1099-B, but then check the box at the bottom of the page for "The cost basis is incorrect or missing on my 1099-B".  Click continue.  On the next page, check "None of these apply".  On the next page indicate "I know my cost basis and need to make an adjustment."

[rehrenbard]

Thanks @DavidD66 

So then the cost basis for the RSUs, should just be the shares * market price for each of the grants that I received, since I was already taxed on these when the grants were given. Can you please confirm that is correct?

Also for the ESPP portion, do you know what the Market price on grant date (per share) is meant to be entered as? I am having a similar problem with ESPP where I entered all the purchases in, but for some reason its showing a $0 cost basis. I had left market price on grant date blank because my plan year runs April - March, and the statements of purchase don't include the stock prcie on the grant date (which I assume is April 1st even though I never purchased any stock on those days). 

Wondering if there I should too just type in my cost basis as sum of each stock purchased * cost I paid for each of these from my work sheet rather than letting turbo tax add it up.

[DavidD66]

Your cost basis for your RSU shares is the value on the date they were issued, which should have been added to your W-2 box 1 wages.

Your company should have provided you with the market price on the grant date.  If not, you can use any one of a number of web sites to look up historical stock prices.  The Market price on the grant could be necessary to calculate ordinary income, depending on when you sold your stock.  Please refer to the following web page for information on the taxation and reporting of ESPP stock sales:

Employee Stock Purchase Plans

[rehrenbard]

Thanks @DavidD66 can you please review how I am understanding ESPP details?

My ESPP plan runs April to March. So I can purchase the entire amount on April 1st for the market price on that date, but instead I purchase it with my paycheck each pay period. So the price I pay for the stock is the price of the stock at my pay period, not at the beginning of the offering period.

 - First day of your offering period - that is April 1st or my hire date, I purchase no stock on this date

 - Market price on grant date - is this the price on April 1st? Even though I purchase no stock then and this price is never used for purchase? 

 - Market price on purchase date - this is the market price on the pay period where I elect to purchase (this is the price stock is purchased at)

 - Price you paid per share - this is roughly 85% of the market price on purchase date. But I am actually calculating the exact price I paid as shares received / price paid since that is slightly different than 85% of the market price on purchase date.

Can you confirm my understanding and that the first day of my offering period and market price on grant date are as above and shouldn't just be the day I purchase the stock? 

[DavidD66]

Based on what you've posted, I believe you understand how things work and a  Many ESPP plans use the lower of the market price on the grant date or the market price at the end of the plan period to determine the price an employee pays.  Since your plan doesn't do that, the market price at the grant date shouldn't be relevant.  That said, it is the price on April 1 in your case.  If TurboTax is using that price to calculate your bargain element, then use the price for the day you purchase the stock.

[rehrenbard]

Thank you @DavidD66 ! Yes putting in the price at purchase date for the grant date price seems to have turbo tax calculating everything correctly.

One last question: Do you think it is then more accurate to also put the purchase date as the "First day of your offering period"?

Since truly my offering date first date is April 1st or my hire date, I purchase no stock on this date and it isn't in any of my computershare statements. So I was thinking I should put in the same day as the purchase date since I am using price on my purchase date as the grant price.

I don't believe this impacts the calculation since all dates are over 2 years ago.

Thank you SO much I SO appreciate your help!

[DaveF1006]

Yes, because the purchase date and grant date are the same,"first day of your offering period." 

[romanm07]

there is a serious BUG in turbotax -  if you enter 'various' for 'Date acquired' it will automatically assume it it  short term gain, even if it is long term gain

[DaveF1006]

It shouldn't assume it's a short-term gain.  Make sure you have the right classification of a sale under the sales section. if you are grouping sales, make sure you are grouping all short termed sales together as well as long-term sales. 

[lauriescag]

I have mainly short term RSUs and NQSOPs and finally figured out that I needed to get another statement for the the grant date/fair value but I have one long term RSU - and I cannot figure out how to make turbotax accept this one. I put long-term basis not reported, just as it is on the 1099B, and 0 for the cost basis, and once I go thru all the details for RSU it will not put it as long term and the adjusted gain is totally incorrect.  I have done stock options for YEARS and they have never asked this much info before. I tried doing the entries manually and then did the online transfer from my brokerage, hoping it would fill in this info, but it asked me the exact same questions. How do I fix this? It should be treating it like capital gains since it is longer than one year. 

[GeorgeM777]

It is unlikely that your RSUs would have a zero cost basis.  Generally, the basis for a RSU is the fair market value on the day the shares vested with you.  Thus, you will probably need to do some research to determine the per share price for your RSUs on the day they vested.   When you are confident that the basis is correct, then your gain should also be correct.

Regarding the long-term error you are seeing, have you checked the date acquired entry and the date sold entry?   To establish a long-term holding period, those dates must reflect a holding period of more than one year.  

@lauriescag

[lauriescag]

Yes but on the first page it wants me to enter zero (from 1e column on the 1099B)and then once I go thru what it is (RSU) then it asks me about the price and the grant date (from the summary statement) - which works out fine for the short term RSU transactions, but this one long term RSU is not calculating correctly. I put in the correct dates, I selected long-term, and I put in the price and the 'gain' it is showing is $7, not the $118.17 that shows on the statement. I am at the point where if it calculated $118 as a short term gain and I had to pay the darn tax on it all, I would, just to stop stressing about it. All the short-term RSUs also had units withheld to cover the taxes and the long term one does not but TT doesn't seem to recognize that long-term RSU exist