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Shambo
Returning Member

Cost basis figure to use in "Capital assets sales worksheet" for a qualifying ESPP sale.

I imported the 1099-B from the broker.

I have a question on the Cost basis figure to use in the "Capital assets sales worksheet" for a qualifying ESPP sale.

In 1099-B, the information for one of the long-term transaction sales is:
Sale 105.000 09/30/18 03/08/21 7,559.96 5,156.13(e) 2,403.83
(These fields are num-shares; dates acquired and sold; Proceeds; Cost-basis; Gain)

In Supplemental Stock Plan Lot Detail, the details for this sale are:
QSP 105.000 09/30/18 03/08/21 7,559.96 240.19 5,396.32 0.00 2,163.64
(These fields are num-shares; dates acquired and sold; Proceeds; Income; Cost-basis; Gain)


==============================================

My question is: which figure I should use for the Cost basis in
"Capital assets sales worksheet" - should it be  5156 or 5396?

In Form 8949, TurboTax uses 5396 as the cost basis, so it is likely
the other figure 5156 is the one to be used.

4 Replies
tagteam
Level 15

Cost basis figure to use in "Capital assets sales worksheet" for a qualifying ESPP sale.

You might want to contact Support via the link below, but you are probably correct that the program just grabbed the first transaction from the import.

 

What is the TurboTax phone number? (intuit.com)

Shambo
Returning Member

Cost basis figure to use in "Capital assets sales worksheet" for a qualifying ESPP sale.

Some more information that I have uncovered since my original posting.

 

I checked my Payslips. In the last payslip for the year, the total yearly salary components are itemized such as regular salary, vacation pay, etc. There are two items "Sale of ESSP" and "Sale of ESSPDQ".  When I add up the amounts for these two items, it equals the income reported for all the ESPP sales by the broker in the "Supplemental Tax Information" form. These two items are also reported in Box 14 of the W2 as ESPD and ESPQ respectively and the sum of the two figures there also equals the income for all the ESSP sales in the Supplemental Tax Information form. This means the employer is reporting the ESPP sales in my W2 and it is already included in Wages (line1 of the 1040).

 

Now let us look at the correct way to handle this in the  "Capital assets sales worksheet"  for TurboTax.

I believe the correct number to enter for the "Adjusted Cost Basis" is the same as "Proceeds" - in this example it is $7,559.96 since we want the "Adjusted Gain" to be $0, and we will avoid double taxation.

 

I talked to TurboTax support last week, but I did not have this Payslip information at that time. I hope to get confirmation from them that this is the correct approach. If any of you folks on this forum have taken a similar approach, please let me know. Thanks!

 

 

 

NCperson
Level 15

Cost basis figure to use in "Capital assets sales worksheet" for a qualifying ESPP sale.

@Shambo - the amount reported as income on your W-2 becomes the cost basis of the shares you are issued.   

 

does that help? 

Shambo
Returning Member

Cost basis figure to use in "Capital assets sales worksheet" for a qualifying ESPP sale.

I think I figured out the answers to my questions.

The Adjusted Cost Basis in the Supplemental Tax Info should be used in the 8949. In the example above it is $5,396.

The value for Column 1(f) should be 'B' and for 1(g) should be 0.

This is explained in chrome-extension://oemmndcbldboiebfnladdacbdfmadadm/https://communications.fidelity.com/sps_library/docs/bro-tax-espp-click.pdf

 

The instructions for form 8949: https://www.irs.gov/instructions/i8949

In particular,  the section How To Complete Form 8949, Columns (f) and (g)

I am reasonably certain I am now on the right track,  but if another knowledgeable person can confirm this, it will be good.  

 

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