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tah0476
New Member

Stock losses and wash sale (ESPP and RSU)

I have a rather confusing situation, at least for me, so I will try to explain it the best I can to get help.  All of this activities occurred this year, btw.

My question has to do with selling share lots from an Employee Stock Purchase Plan at a loss.  I sold share lots on three occasions this year, and I purposely picked the lots that would sell at a loss (HIFO).  Problem is, at the same time each month, (1st and 15th), I continued to purchase new share through the company plan.  At one point, I also received RSU shares that vested.  So, here are my questions:

 

Here are the details:

On 4/15, I purchased 2 shares through my ESPP

On 4/27, I sold 27 shares at a loss

On 4/29, I purchased 2 shares through my ESPP

On 5/13, I purchased 2 shares through my ESPP

 

1)  In this scenario, can I still deduct the loss for 21 shares (27 minus the 6 I purchased in the 30 day window)

2)  Will the 1099 account for this and will TurboTax guide me through it?

3)  If I had RSU vest in the same window, I would not be able to claim that number of shares as well?  So say in the above scenario that I received 10 RSU shares on 5/14, then I would now only be able to deduct the loss for 11 shares (27 minus 6 purchased through ESPP minus 10 received as RSU)?

 

Hope this all makes sense.

4 Replies
Mike9241
Level 15

Stock losses and wash sale (ESPP and RSU)

wash sales can only apply to the number of shares sold at a loss and then reacquired during the wash sale period. so you are correct.

For the purpose of wash sales a "purchase of securities" and you vesting your RSUs are identical - essentially the IRS sees each vest as a purchase.

 

yes, Turbotax will guide you through the reporting of a wash sale.

 

can't say if the 1099-B will be correct 

NCperson
Level 15

Stock losses and wash sale (ESPP and RSU)

1)  In this scenario, can I still deduct the loss for 21 shares (27 minus the 6 I purchased in the 30 day window)

 

yes - but was there a purchase in last March????

 

2)  Will the 1099 account for this and will TurboTax guide me through it?

 

if it's all from the same broker, it should, but you are responsible for reporting it correctly on the tax return, none-the-less.  Turbo Tax can handle this

 

3)  If I had RSU vest in the same window, I would not be able to claim that number of shares as well?  So say in the above scenario that I received 10 RSU shares on 5/14, then I would now only be able to deduct the loss for 11 shares (27 minus 6 purchased through ESPP minus 10 received as RSU)?

 

correct

tah0476
New Member

Stock losses and wash sale (ESPP and RSU)

My situation is a bit more complex I believe due to the involvement of the RSU vesting.

So here is the scenario:  (FYI, prior to this I knew nothing about wash sales).

 

On 4/27:  I sold 27 shares of my company stock in my ESPP account.  I purposely selected HIFO and sold all shares for a loss (~$800)

On 5/1:  I had an RSU grant vest (71 total shares, received 44, 27 withhold for taxes)

 

As I have been reading about wash sales and how to deal with them on my taxes, I have learned that the loss ($800) is not gone forever; I am to add it to the cost basis for the share purchased (in this case the vested RSU shares). 

 

RSU questions:

1)  Is that true in the case of the RSUs? 

2)  Do RSUs have a cost basis and what is it?

Non RSU questions:

3)  Also, I have to ask this again because I am purchasing shares monthly through my ESPP.   This is a "share for share" thing right?  By that I mean, if I sold 10 shares on day 1 for a loss, then bought 2 shares on day 2; I can still write off the loss for 8 shares, right?  and then defer the loss for the 2 shares by adding that loss to my cost basis for the 2 shares purchased on Day 2.

Example:  Day 1 sold 10 shares (cost basis $5 per share) (sale price $3 per share):  Loss is $2 per share.

Day 2 purchased 2 shares @ $3 per share.  total cost basis would be $10 (6$ from this transaction plus $4 deferred loss from the 2 shares from the first transaction).

 

Does this sound like I have it right?

NCperson
Level 15

Stock losses and wash sale (ESPP and RSU)

@tah0476 please read / watch this link

 

https://turbotax.intuit.com/tax-tips/investments-and-taxes/employee-stock-purchase-plans/L8NgMFpFX

 

there is additioanl complexity based on how long you held the ESPP shares.  Your understanding of washlosses when you sell your RSUs is spot on. 

 

The cost basis of the RSU's is the SAME as what was added to your  paystub / W-2.  For example, 100 RSUs vest on a day they are selling for $10 per share.  So you have $1,000 of additional wages and the cost basis of those 100 shares is the same $10 per share. 

 

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