Sales from RSA with 83(b) – Long term or Short term?

[laserghost]

Hello! I need advice for this particular situation.

BACKGROUND
My employer went public in Feb 2021, and I received stock awards, but before they went public, in June 2020, I was awarded a lot of "Class B Units" under an incentive plan that was established in 2020 – before the IPO. Additionally, I signed and filed the 83(b) election upon receiving the Class B Unit award. The base price and FMV of the Class B Units was $0. The Closing Date is listed as June 19, 2020 and the Vesting Reference Date is January 29, 2020.

Later, after the Feb 2021 IPO, the Class B Units were converted to restricted shares of Class A common stock. Vesting schedule is time based, and upon receipt of the stock, about 12% of my shares were immediately vested (I'm assuming this is because I had been holding the Class B Units for a some time, and a portion then vested?). 

However, I couldn't sell any vested shares right after the IPO because there was a customary lockup period of 180 days. Fast-forward 6 months – we're in August 2021 – the lockup period expired, and I sold some shares.

The 83(b) must have worked because I didn't see the vested shares on my W-2 as income, my W-2 income is the same as my base salary.

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WHERE I NEED HELP 🙂

Now I'm entering the details of the sales in TurboTax, from my 1099-B. The form indicates "SHORT-TERM TRANSACTIONS FOR WHICH BASIS IS AVAILABLE BUT NOT REPORTED TO THE IRS - Box B checked". The Cost Basis is listed as $0.

My understanding is that I will just be paying Capital Gains tax on the sales thanks to the 83(b). But wouldn't these be Long Term instead of Short Term, because I had been holding the Class B Units for 6 months, and then the stock for another 6 months?

I have three separate sales, and the Date acquired on the 1099-B is stated as August 10, 2021 – which coincides with the lockup period expiring, but I was holding the (Class B) shares since June 2020, and the (Class A) stock since Feb 2021.

So does the Date Acquired field need adjusting? In TurboTax should I adjust sale category from Box B (Short term noncovered) to Box E (Long term noncovered)?

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MY ULTIMATE QUESTION

Should I make any changes/adjustments to what's on the form 1099-B, or should I enter it exactly as the form indicates?

[RobertB4444]

It's a good question.  I would not just change the sale from short to long term.  Even though the IRS doesn't have the cost basis they do have the amount of sale proceeds and whether or not it was short or long term.  So if you change it they're going to want to know why.  

You should first contact your broker.  Whoever handled the trade for you needs to know that they have the acquisition and vesting dates wrong or they need to explain to you what dates they used in order to set the holding period so that you understand why it is entered the way that it is.  

Either way, looks like you should get an extension.