1099-B incorrect gain calculation

Forum|Forum|5 years ago
April 13, 2021
1 reply
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Hello,

I've been fighting with turbo tax premier for a few hours now. While entering info from my 1099-B from an employee stock account it seems to be trying to tie my 1099-B Proceeds to my W-2 (probably correctly), but it's causing it to produce an incorrect Gain/Loss value. To troubleshoot I've done the following:

With an Imported W2 from my employer:

- Imported my 1099-B from my broker account (produced an incorrect Short Term Gain of $2620.00)

- Manually typed in all the transactions from the 1099-B (produced an incorrect Short Term Gain of $2620.00)

- Manually typed in grouped transactions (Long term and Short term) (produced correct Short Term Gain of $-40 (fees for sell to cover transactions))

In a separate return file with no W2 info:

- Typed in all of my 1099-B transactions (produced correct Short Term Gain of $-40)

I'm really struggling to figure out what's going on here. Any advice would be helpful.

gloriah5200

Level 10

Here are a couple of links on how to enter the ESPP purchase and sales info and the Employee Stock purchase and sales on W-2 and 1099-B.

Here is a link for help on entering Employee Stock purchase plan and sales:

ESPP purchase and sale info

Employer stock purchase and sales reported on Form W-2 and 1099-B in Turbo Tax:

Employee stock purchase and sales on W-2 and 1099-B

Anonymous

Hi Gloriah,

Thanks for the reply. Neither of the links seem to be the answer to my problem. Maybe I can be more specific with an example sale and what Tubo Tax is doing:

In June of last year, I had 3 stocks vest, 2 were sold to cover taxes, I received 1. Let's say the stocks value was $500 at the time of vest.

When I input this into the Turbo Tax software it goes like this:

Input the sale from the 1099-B (2 shares sold, $990 profit (2x$500 minus $10 commission on the sale, $1000 Cost Basis) net gain $-10
Turbo tax asks if the stock was received as a part of an ESP, yes, select RSU
It asks questions about the RSU vest date and how many were sold (info comes from 1099-B)
It asks if this was multiple or a single lot
Now it asks you to look at the bank transaction for some info about the vest:
1. Total shares Vested: 3
2. Shares sold (withheld) to cover taxes: 2
3. Date vested
4. Price Per Share on Vest Date: $500
5. Price Paid for shares: $0.00
6. Commission / fees: $10
Now it shows the RSU Sale Results
1. Proceeds, less expenses: $990
2. Price paid: $0
3. Compensation income: $1500 (3x$500)
4. Cost Basis: $500 <--- this is the problem. It should be $1000 as there was two stocks sold, not 1.
5. Short Term Gain: $490 ($500 - 10, the missing cost basis less commission)

So now when you look at all of your sales for the year, the short term gain is wrong because the cost basis is wrong.

Hope this helps explain the issue. It's entirely possible I'm inputting something wrong, but this appears to be a bug in how TT is computing the STG and Cost Basis for the RSU sell to cover taxes sale.