The IRS says I owe 10026 in taxes from 2021, but they have my income as higher than I actually made. Stocks sold were counted in my w2 and also by the IRS. What can I do?

[cam-ld]

My previous employer counted my stocks sold as income on my W2 in addition to the income I made working there. But the IRS is also counting those stocks as additional income, so it looks like I made twice as much money as I actually did.

[taxlady28]

Amend your return and for each of the employee stock transactions you need to put in the basis of the stock.  Your employer would have given you a 3921 form and use the basis of that form for each stock transaction on the return.  As you adjust those basis amounts your taxes will be adjusted down to the correct amount.  

[SteamTrain]

i.e. When you filed yoru taxes, you were supposed to also indicate the exercise of those stocks on a form 1099-B/8949.

When doing so you would update the "cost" of the socks exercised to be the same as the price of the stock on the day you exercised them...resulting in zero gain (perhaps small loss due to broker fees).

When the IRS saw you missed entering them on the form 8949 when you filed, they calculated the gain based on your grant price-to-exercise difference.

[cam-ld]

Is there anything I can do to fix that? They have my income from that year as much higher than it was. I guess I missed the 1099 since the stocks were already reported as income in my W2 and didn't realize I needed another document.

[Critter-3]

READ the CP2000 notice carefully and respond as directed.  You may need to fully amend the return or  just complete the missing 8949 & Sch D.