The 1099B does not show any tax withheld for RSUs sold in 2016, but the brokerage transaction details shows federal, state taxes paid. How to report this in TurboTax?

[bkhinrichs]

They were supposed to have withheld 33-35% on the RSUs and it looks, from our W-2, like only 22% was withheld. This is where we're hoping that something additional will show on the 1099-B because the W-2 doesn't seem to include everything.

[TomYoung]

"Meaning, we asked for a significant amount more than the usual 22%, which they did hold back. But this additional amount is not reflected on the W-2."

and

"They were supposed to have withheld 33-35% on the RSUs and it looks, from our W-2, like only 22% was withheld. This is where we're hoping that something additional will show on the 1099-B because the W-2 doesn't seem to include everything."

Well, maybe the payroll department didn't do what you asked, maybe they did and you're just not seeing it, but talking it over with the payroll department is the only way to determine what they did.

"In the statements we can see on our brokerage website, the shares held represent a much higher percentage. So why is this not reported on the W-2?"

I think what you're saying here by "shares held" is that the shares that got sold "to pay for taxes" is higher than you'd normally expect it to be and you can't trace that "higher" amount to your W-2?

One answer to the question as to "where are the extra taxes showing up in my W-2?" could be a misunderstanding on your part.  Shares sold "for taxes" encompass all the taxes normally associated with a paycheck; federal withholding, state withholding, local taxes, FICA, possibly state unemployment taxes, state disability tax, etc.  So those "extra taxes" could and should be showing up in more than just your federal income tax withholding.  Again, the payroll department should be able to map this out for you.

"I'm not sure what it means to use the "wrong basis," so I guess we'll have to look into that once we receive the 1099-b."

Here's the problem; ever since (I think) 2010 brokers have been reporting the wrong basis for employer stock on the 1099-B.  They are supposed to supply the correct numbers with some sort of additional statement that comes with the 1099-B but it seems like lots of people don't see this statement and only look at what's on the 1099-B.  In the case of RSUs they report $0 as the basis since the broker's requirement is to only report what you paid out of pocket for the shares.   The actual per-share basis is the same per-share number used by the employer to calculate the compensation created by the vesting of the RSUs.

[David5555]

I have a question related to RSUs and my W2

For some reason, my company does not include the value of vested RSUs in my W-2. TurboTax calculates the amount of income using the RSU section of the Exercise of Stock Option Worksheet but it doesn't add it to my form 1040 line 1 income.  It looks like I can manually adjust the Form W-2 and put in the correct number but that doesn't feel right to me.  I have reached out to payroll at my company and have not had much success.

Is there another approach?

[RaifH]

It probably is reported on your W-2. If your company did not report your RSUs in Box 14 or in any supplemental information with your W-2, that does not mean that the income from them was not included in your wages and that the tax withheld from any sales was not also included in your W-2. Have you verified with your employer that the income reported on our W-2 does not include the value of your vested RSUs? Unless it is a private corporation and the stock is non-transferable, this should be on your income in the year vested. 

You do not want to manually adjust your Line 1 amount, because the RSUs would also potentially impact Lines 3, 5, and 16 and the taxes withheld should be reported on Lines 2, 4, 6, and 17. While you could determine the correct wages to report, you would not have a way of knowing where the withheld taxes went. 

I would look for a pay stub from the vesting date of your RSUs. If you cannot find a paystub for the vesting date, and there does not seem to be any unusual bumps from one paycheck to another, and you cannot contact the payroll provider to ensure the RSUs are not included on your W-2 and they are not able to offer you a corrected W-2, you can report your income from your RSUs in Federal > Less Common Income > Miscellaneous Income > Other income not already reported on a Form W-2 or Form 1099. This will ensure the additional taxes for Medicare and Social Security are also being assessed to this compensation. 

@David5555