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RSU's - The company sold stock to cover my tax burden. Do I need to record those in a stock sale? I did not sell the remaining share in 2023, thus I do not get a 1099B

 
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DavidD66
Expert Alumni

RSU's - The company sold stock to cover my tax burden. Do I need to record those in a stock sale? I did not sell the remaining share in 2023, thus I do not get a 1099B

No.  Based upon your statement, you do not need to report a sales transaction.  RSUs are not actual shares of stock, but "units" representing stock to be issued upon vesting.  When they vest, sometimes a company will issue the employee the full number of shares represented by the RSUs.  In this case shares are sold to pay the tax withholding.  In other cases, the Company will determine the amount of shares that equal the amount of tax withholding and withhold (not issue) those shares.  In this case, there is no sale of shares to pay the tax.  

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DavidD66
Expert Alumni

RSU's - The company sold stock to cover my tax burden. Do I need to record those in a stock sale? I did not sell the remaining share in 2023, thus I do not get a 1099B

No.  Based upon your statement, you do not need to report a sales transaction.  RSUs are not actual shares of stock, but "units" representing stock to be issued upon vesting.  When they vest, sometimes a company will issue the employee the full number of shares represented by the RSUs.  In this case shares are sold to pay the tax withholding.  In other cases, the Company will determine the amount of shares that equal the amount of tax withholding and withhold (not issue) those shares.  In this case, there is no sale of shares to pay the tax.  

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RSU's - The company sold stock to cover my tax burden. Do I need to record those in a stock sale? I did not sell the remaining share in 2023, thus I do not get a 1099B

Only when I sell the RSU's, they I will include them in my filing, correct?    I did some research, and apparently there is a supplemental form with 1099 I need to watch for, so I don't pay additional taxes.  Are you aware on the content of this form ?  As I will sell stock, not in the year I received the shares.

 

Thanks,

David

DavidD66
Expert Alumni

RSU's - The company sold stock to cover my tax burden. Do I need to record those in a stock sale? I did not sell the remaining share in 2023, thus I do not get a 1099B

Yes, when you sell your stock shares you will receive a Form 1099-B.  The cost basis shown on the 1099-B will probably either be wrong, or completely missing.  Your cost basis in your shares is the value of the stock on the date the RSUs vested.  This is also the amount that was added to Box 1 of your W-2.  To calculate your cost basis per share, take the amount that was added to your taxable income and reported on your W-2 divided by the total number of shares that your RSU award represented (including the ones withheld by your company for tax withholding).  That is your cost basis per share.  When you sell some or all of your shares, you will probably need to add or adjust the reported cost basis on your Form 1099-B.

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