RSU stands for Restricted Stock Units. The biggest difference between RSUs and employee stock options is that RSUs are taxed at the time of vesting while stock options are usually taxed at the time of option exercise. The employer is required to withhold taxes as soon as the RSUs become vested. In a previous post, Restricted Stock Units RSU Tax Withholding Choices , I wrote about what I chose among the three tax withholding choices — same day sale, sell to cover, and cash transfer — and why.

Suppose you had RSUs vested on October They will also withhold the same amount of taxes regardless of your choice. They will also include the taxes withheld on your W How you account for taxes on your tax return for the rest will depend on your tax withholding choice.

The employer will deduct a number of shares from your vested shares and give you the rest. In our example, although your employer says you have shares vested, you actually only receive 60 shares. Use the numbers on your W-2 as-is.

Make a note of the closing price on the vesting date. You have to remember the date and this number until you sell the remaining shares. If you sell them for less, you will have a capital loss. You report the capital gain or loss in the year you sell the remaining shares. For a step-by-step guide on how to report the sale in TurboTax, see Restricted Stock Units RSU and TurboTax: If you make this choice, you sell everything.

How Restricted Stock And RSUs Are Taxed

Your cost basis is the amount your employer included on your W-2, which is the closing price on the vesting date times the number of shares vested. The income and the associated tax withholdings are already included on your W Use those numbers as-is. I wrote a follow-up post RSU Sell To Cover Deconstructed to clarify this option. Again, the income and the associated tax withholdings are already included on your W-2; you just use those numbers as-is.

You will show a short-term or long-term gain or loss for these remaining shares depending on your date of sale and the sale price. If you make this choice, you give your employer cash for the tax withholding.

You can sell the shares either immediately or keep them for however long you like. The tax accounting is the same as if you bought the shares at the closing price on the vesting date.

You will show a short-term or long-term gain or loss for these shares depending on your date of sale and the sale price. The income from RSU vesting and the associated tax withholdings are already included on your W-2, and you just use those numbers as-is. Hope this is helpful to someone looking for info on the tax treatment and implications of RSU sales. Track your net worth, asset allocation, and portfolio performance with free financial tools from Personal Capital.

Investing , Taxes keywords: February 27, at 1: Being given only the sell to cover option, and quarterly vestings of RSUs in , I vest four times during which stock is automatically sold to cover taxes. I sell the remaining shares from three of these four vests during My W2 however, lists ALL the RSU vested value. April 14, at If I net share settle at issue, I own 1, shares. Net share reflects the cost of the taxes paid at issue in fewer shares. How do you reflect the cash paid at issue in your future gain calc?

April 14, at 1: February 28, at 3: In one instance, I had roughly shares vest, and 54 were sold immediately to cover the taxes. February 28, at 4: You account for them when you sell them, which can be the same year or many years later.

At that time, you record your sales proceeds and a cost basis which equals to the value of those shares at the time of vesting. Basically you treat those shares as if you bought them at the price your company calculated on your W February 28, at 6: February 29, at 1: March 4, at 9: Thanks for your helpful post on the proper tax treatment for RSUs.

I have a question regarding restricted stock awards.

In , three relevant transactions occurred:. I received documentation for all three transactions, but I only received one B and it just covers the Mar07 transaction. Do I need to account for the Jan07 and Dec07 transactions on my tax forms? March 5, at 4: Matt — Same answer as I gave to Jagadeesh in the previous comment. The sale proceeds equal exactly the tax withholding reported on your W March 5, at March 11, at March 11, at 1: Thanks very much for the details.

In turbo tax I entered all my details. But when I click Done it takes me to Employee Stock Plan Result page and shows the following details in a table Stock Plan, Amt we computed, Is it on w-2, Actual Amount on w2. Here is an example: RSU Amount we Computed: Yes Actual Amount on W2: What should be the value in the Actual Amount column or In W2 I have as my earning. Please let me know what should be the correct amount.

March 12, at You must have a different version of TurboTax. Anyway, you should look at the Schedule D it produces for you. Put in a value, then open the Schedule D form.

March 22, at 2: March 27, at 1: However in my case, my employer withheld stock to cover the taxes. Is that the same as sale to cover. Should anything be listed on the my schedule D? March 28, at Anonymous — One more time, same as sell to cover, except no broker was involved and no B. Same answer as in comment to Jagadeesh and Matt.

March 30, at 4: There were 4 times last year when my shares vested 4 shares each time and the company did a sell to cover each time. TurboTAX deluxe does not give me a screen for RSU sales. Does it go under Investement sales as a stock sale? If you do have a loss from sell-to-cover, then you have to take into account the wash sale rules. March 31, at 9: In my case, the CO did a sell to cover and amount sold was reported in my W-2 under taxes withheld.

March 31, at 5: April 2, at 3: I think I can report a capital loss for the sell to cover as it was a lower price than that reported on my W-2 and I made up the difference out of pay. But… my does not have an entry for the sell to cover — can I still report it on Schedule-D? April 2, at 8: Maxwell — Whether you receive a or not, you still sold shares.

If you sold for less than your cost basis, you had a loss. See my previous comment on how the sell-to-cover is deconstructed. April 2, at 1: LM I had RSU shares vest in small blocks between years Can one use EITHER the grant date price or vesting date price as tax basis? April 2, at 9: LM — Your basis in each lot is the amount of income your employer included on your W If they used price on the vesting date, you must also use that price.

Unless you specifically identified the lot s at the time you sold those shares, you must use FIFO. See Identifying Shares You Sell on Fairmark. April 4, at 3: April 4, at 4: Anon — Change withholdings. There is no quarterly deadline. Your employer reports it for you on your W April 4, at 9: I had restricted stock units that vested in The month before vesting- I signed an agreement with my company that all shares would be sold upon vesting.

I am using turbo tax to figure my taxes. Since the captal gain it should offset is included on a W Is there any way to recognize this loss in ? I would appreciate any advice or guidance. April 4, at If you sold other investments which produced capital gains or if you received capital gains distribution from some mutual funds, the loss will offset those gains. If you still have more loss, the loss is carried forward to the next tax year. April 6, at Thanks for your tips that helped me get an understanding.

April 8, at 1: April 8, at 7: I understand about reporting the sale on Schedule D. My question is about all the fed tax, fica medicare, fica social security, state tax on the RSA transaction advice. Does that add into what is on my W2? April 8, at 9: The RSU related income and tax withholdings are already included in your W Use the numbers from W-2 as-is. April 9, at 5: I did cash transfer for paying the tax your option 3.

How should the with holding be shown on W2? The cost basis for RSUs was used to show the income correctly, but the taxes withheld does not include the tax money I paid in cash. I am confused as to what to show in Schedule D and how to get the tax withheld included in filing for this year.

Any help would be great. Restricted Stock offset is shown as April 9, at Sridhar — You did cash transfer. No shares were sold. Therefore nothing to report on Schedule D for last year unless you sold the shares later in the year. Use the W-2 numbers as-is. Both the 1, income and April 13, at 9: In turbo tax I enter in the 57 shares. It ask me for a value lot in which I enter the 68 shares at market price On the Statement of taxable income both the April 13, at Thanks for the detailed information.

Does the RSU vesting schedule invalidate a loss due to wash rules? More specifically, say shares vested on Jan 10 as a part of a quarterly vesting schedule. So, shares would vest on Apr 10 as well.

If I sell shares vested from Jan 10, at a loss on Apr 3, Can I get the tax adjustment for the loss. Mak — For the purpose of applying wash sale rules, treat RSU vesting as buying shares. For more info on wash sale, see Wash Sales on Fairmark. Previous anon — Please read this post, the comments, and the follow-up post for sell to cover again. May 8, at 3: May 15, at 2: July 29, at 2: Was there ever an answer to the May 15th Question from Tax Guy?

I have the same exact question about W2 reporting from an Employers side. July 30, at I imagine employers who issue RSUs have accountants and tax attorneys advising them. October 11, at 1: I have a couple questions regarding RSU. At each vesting schedule, say shares were sold to cover the tax. The brokerage firm reported the sell-to-cover a few days after each vesting date on B. Should I report the sell-to-cover for the last schedule vesting in return or return?

If I report in return, then the income number of from shares do not match with her company report in W-2 of shares, in which case I gained some tax refund. Is it a problem? Do I need to report the shares vested in even though the last sale was actually occured in early january of ?

Any answers are appreciated. October 11, at 7: TaxMan — You still report the income and tax withholding for 1, shares in according to the W-2 issued by the company. See the follow-up post RSU Sell To Cover Deconstructed.

October 13, at 2: Obviously it was not matched because the W-2 report higher income from the total of shares. I had to say NO to the question. As a result, Turbo Tax subtracted the income from the last shares from my W-2 income; thus yielding some additional refund. I tried to create another investment sale with no sale data and just entered lot award with those last shares, then Turbo Tax calculation matched with the figure in W However, Turbo complained at the error check that this investment is incorrect because there were no sale date, sale price, etc.

Any helps with this problem is much appreciated. October 13, at 3: Mahesh posted the TurboTax Premier step-by-step with screenshots in the comments to this post. To be honest I think the extra guidance in TurboTax Premier is making it more confusing to you than being helpful. January 31, at 4: Thanks for the clear, concise description of tax handling for RSUs. Had to deal with this for the first time this year, and your writeup was a life saver.

February 17, at 8: Would the market price be the I get that the shares witheld are and The terms used from the broker somewhat differ then that of turbotax…so it is confusing to know which is what and where to put it?

February 18, at 2: February 18, at 8: I thought I only had to when stock was sold. I suppose that means I must file and amended return! February 19, at 7: Thanks for this info! It seems to me, that I was just overcharged for this stock grant. February 19, at 9: JoeBlow — The withholding includes taxes for federal, state, and Social Security and Medicare.

February 22, at 9: Under RSU, I was awarded shares of my company. I used the option to sell all shares. Company held shares for tax purposes and sold only shares at my brokerage account. My B shows shares sold and sale value.

Also my W-2 shows FMV for shares as award and FMV of shares for tax withholding. As my B only show share sale, what do I report as cost basis for this?

eqogypacuc.web.fc2.com Help - eqogypacuc.web.fc2.com Help - Restricted Stock Units

March 4, at The 41 shares sold have cost basis at the price they included as income on your W March 4, at 8: Can I assume that Cost Basis is the same thing as Gross Dollars on my Smith barney Transactions History Statement?

In and , I received certificates of stock from my company following vesting of restricted stock. The shares were subsequently sold, and I now need the cost basis to determine net revenue for taxes.

Unfortunately, my company managed the transactions internally, and there are no broker records where this is broken out. On the certificates, there are dates shown in the lower left corner.

Is it possible that those are the vesting dates which could then be used for cost basis purposes? The reason I ask this is that a third certificate was issued in This was handled by a broker, so I know the vesting date, and it corresponds to the date shown on the bottom left corner of the certificate. Thanks for your help. March 17, at 6: My RSU situation is sort of complicated. I had shares given to me by my company in March that were not supposed to completely vest for 2 years.

My company was purchased in late prior to the shares being vested and as part of the buyout, the company paid out the shares as if they were fully vested in the form of a ash payout to a brokerage firm. I was taxed at my normal tax rate, as if the award was a cash bonus.

The income and taxes were included on my W After speaking with the brokerage firm that handled the transaction, they explained that the shares were never officially awarded since the company dissolved and that they were only used by my company to ditribute the cash equivalent to the shares.

March 17, at 7: I am using Turbo Tax Deluxe, Where is this info reported, so I can pay the tax on this? March 24, at Regarding your Oct 13th post: I ran into a similar situation where Turbotax wanted to correct my R2. Its RSU calculation that it wanted to use to update my W2 seemed to add the vesting value for RSUs from to the vesting value for because I sold some RSUs during that vested in The vesting value for had already been account for on my W2.

March 24, at 2: J — I said this a few times in the replies already. I think the simplest way to do this is bypassing the TurboTax handholding for RSUs. Use the Spreadsheet-Style Entries. Not all versions have the extra guidance.

That guidance really confuses you more than helping you. The Spreadsheet-Style Entries are much simpler and clearer. July 22, at 1: Assume company withholds just enough shares to cover the tax withholding as calculated on the date of vesting Sell to Cover. July 22, at 4: Liz — Did you ask the company in question? I believe the tax is calculated based on the date when the RSUs are not subject to forfeiture vesting date.

When the RSUs are actually delivered to you or when you are able to sell the shares are not relevant. August 14, at 2: That was so well explained—thank you very much!!

Your article explained everything very clearly!! August 18, at 1: I have yet another RSU question. How do I avoid double counting this. February 13, at 4: How do I determine the cost basis for Restricted Stock Units where a single sale consists of multiple acquisition dates and acquisition prices? February 13, at 6: February 15, at 5: Very helpful information here, thank you. February 21, at 7: With restricted stock units, the biggest sources of confusion arise when companies use automatic share withholding for the taxes.

Instead of getting all the shares granted, you just get the net shares. For example, instead of getting the 1, shares in the grant, you only get in your account.

You are still taxed on the value of the 1, at vesting and need to remember when you eventually sell the shares, that you use the cost basis for this number of shares and not the 1, shares.

February 25, at 9: My company issued me several RSU grants throughout the year. For each one, they sold to cover. The records that came back from the broker has the sell-to-cover transactions arranged in FIFO order, so for example:. This style of reporting seems to contradict the simplified tax statement you have above, and considerably increases my tax liability over these sales.

I have heard a rumor at work that I can ignore the broker reports because the sales were made to obviously cover taxes for each grant, and this is adequate documentation of lot allocations so that I can claim them as:. Is this adequate documentation? I only have email from my employer and the RSU contract that state this. February 27, at When my RSU vested, I used the option to sell all shares. Where can I report the broker fees?

March 2, at I believe I understand everything that you have said. Thank you for that. My question is…I sold shares. The shares were acquired on different dates. Do I have to input them in turbo tax by the different acquisition dates? March 6, at 4: A portion of my restricted stock vested and my employeer sold shares to pay the taxes. The remaining shared are transferred into my e-trade account.

My w-2 included the sold to cover the stock but does not include the value of the remaning stock. Do I need to report the remaining stock as income? March 6, at 7: Mike — Double check your W It should include the value of the vested shares as income and the value of the sold shares as tax withholding.

March 10, at 5: I entered as follow: March 15, at 4: Thank you very much for the tips. It is very helpful. My situation is a little bit more complicated.

I had shares of WYE vested at I am still holding PFE shares. How do I report my tax return using Turbo Tax? Thanks in advance for your advice. March 15, at 5: All above examples are about selling all shares in one lot the same they vested.

How do I report this sale in using turbo tax since they are nearly 3 years later and in multiple sales?

Do I need to report the withheld shares also — if so how since 2 years have past? March 19, at 8: Not sure if it matters, but it is in pounds converted to USD when we sold shares.

He received a DIV, which was just dividends, so that was easy. Also received a B. Any help you can give would be much appreciated. March 19, at 9: Everyone — When your shares vest, think of it as receiving a cash bonus and buying shares with that bonus. The cash bonus is added to your income on the W Your cost basis in each share is the price per share on the vesting date. When you sell your shares, you report the sale proceeds, your cost basis, and your gain or loss.

March 20, at 3: Hi TFB — But if the RSU shares turned into shares of a different company, the acquisition company, was the transaction considered as selling of the original shares and then buying of the new acquisition company shares? Or was the transaction simply considered continuing holding of the old shares? March 20, at 5: Susan — For your part-stock-part-cash merger, you have to take into consideration the value of the PFE shares you received on the date of the merger.

Basically if the value of the PFE shares you received on the merger effective date was greater than your cost basis in your WYE shares, you carry your cost basis into the PFE shares and the cash portion is all capital gains distribution. If the value of the PFE shares was less than your cost basis in WYE shares, the excess cost basis becomes non-taxable return of capital and any additional cash on top of that is a capital gain.

There are some examples there. If you read carefully and follow the examples with your own situation, you will get it. March 20, at 6: Susan — You may also find this calculator helpful. March 21, at 7: I think i understand it but i want to make sure i got it right and i do have a couple of questions. When filling taxes using a software i enter 2 different entries 1. Now for the 50 RSU, my company say kept 20 and gave me 30 shares.

What do i do for the remaining 30? I did sell them in Read the article again and also read the follow-up RSU Sell to Cover Deconstructed. March 21, at 9: So now if i sell at a price greater than 20 i report gain else loss. This is great information.

I have RSUs that vest once a year over the course of four years. Since the event creates no unreported tax implications, is this really an issue? I just wish I had found your site sooner. April 3, at Since the company already withholding some of my RSU stock for tax purpose for example, I have shared vested, but only getting 60 shares, 40 shares are withhold for tax , why they still report the total vested share value in W2 accounted for tax again?

April 3, at 1: What is reported on your W-2 for that bonus? April 4, at 6: TFB — Thanks for your explanation! So you mean once the RSU got vested, they will report the value of them as wage in W2, and also at the same time put the withholding tax in W2 or in my pay stub as well? April 7, at 2: Employer paid full value at time of award via paycheck and was taxed fully at that time on entire amount.

Half of the award was given as cash compensation, and the other half was used to purchase shares of company stock, which was done by a broker, and the company put into an account under our name. Stock was fully vested when given.

Tax Treatment of Restricted Stock Unit (RSU) Benefits | Canadian Capitalist

If so, would do this for value given each year… We then sold all shares from and in April 10, at TFB, On my W2, RSU is shown in box 12c with code V as total amount vested and I received a letter from broker showing the qty of stocks withheld for taxes and broke down in fed, state, soc, and medicare.

Is RSU same as non-statutory stock option? April 10, at 4: Code V in W-2 box 12c is for non-statutory stock options. April 10, at 5: The B says Restriced Stock Plan Account on top. I have read all the definitions of stock options, and none simply say that it is given in this way.

It seems like it might be considered same day, but I have no idea. In Turbo Tax Deluxe, it asks questions, and confuses me further. In our case, it would include both, and Turbo Tax wants me to split it. Please answer my questions. Turbo Tax says to treat as two different sales and split into how many shares were bought 44 first time 81 second time , but they were all sold same time April 10, at 7: From what you described, it does not sound like a typical RSU program.

Where does the tax withholding come from? Presumably from the cash portion? Your basis in these shares are the total cash you spent on buying the shares plus reinvested dividends. You have to separate the lots into short-term and long-term.

Draw a line at the one-year from date-of-sale mark. Allocate your sales proceeds proportionally to the number of shares. Holding period shorter than 1 year is short-term. Longer than 1 year is long term. April 11, at What do you show on ur return, non-statutory stock option or RSU? I used RSU sell to cover method on my tax return. April 11, at 7: The amount is just in box 1. April 15, at TFB, I filed before reading the posts.

My employer did a sell-to-cover. There is no B entry for this and the vested amt is on W2. Would IRS know this and consider this my sale?

Should I be concerned about this now that the tax has already been sent out. April 15, at 3: July 6, at 1: RSU question—Sell to Cover— If the company did not sell enough shares to cover the taxes then finds the error what happens now? Do I pay in check or do they deduct my paycheck?

July 6, at 3: If the withholding is insufficient, you will have to make up the difference at tax filing time. You may owe underpayment penalty and interest as well if the withholding is drastically insufficient. If the company wants to withhold more now, ask them how they will do it. They will likely deduct your paycheck. September 13, at Does it matter whether I sell in within 1 year or not? If I hold on to them for at least 1 year, how do I report the sale so that I get taxed at long-term rate?

Would I then get a rebate if witholding was done at short-term rate? Follow-up question — assuming I have to pay taxes at short-term rate, if I donate the stock to a c , do I get to effectively avoid the tax? December 1, at I had shares vest on March 1st I am going to sell the remaing shareson March 2, January 7, at 4: Hi TFB, thanks for this post.

In May my shares vested. A month later I sold all the shares for a very small gain. I did not include anything on my tax return except the totals from my W-2s. Apparently they became aware of them through the broker. Now that I need to clear this up, my question is, how should I have reported the cash transfer on my return in the first place?

January 8, at 4: But when you sold stocks, you should fill out a schedule D with your sales proceed and your cost basis. In this case your cost basis is the fair market value of the shares at the time of vesting. Did you fill out Schedule D in the year of the sale?

January 14, at 2: January 18, at January 23, at Great article, Quick Question- Sell to Cover option. The sale for tax is accounted for on my W January 24, at 6: TFB, I have an RSR question. Taxes were paid with stock, so I received 40 net shares. I am using TurboTax Deluxe. If yes, what would I list as my purchase price? Would this be the value of the stock upon grant to me, or total value prior to the 27 share original tax?

January 28, at 1: But one clarification would be helpful that I think is covered in the posts but wanted to ensure. The condition is that a 1 restricted stock grant had a fair market value the same price as the taxable compensation, 2 appropriate taxes were deducted at time, and 3 there is no broker or other fee.

My question, in this type of case, is there any purpose or requirement to include such on a Schedule D since there are no tax implications that warrant filing a Schedule D? January 30, at 7: Thanks for the article TFB. The article really clears up how to report this on my taxes. I was audited a couple of years ago because the company only showed the total value of the sale, not the cost basis, so it made it look like a lot more money.

I have a question about reporting the sale of options. However, taxes were withheld at the time of the sale, and the gain shows up on my W2. January 31, at 9: So my husband got a job and his employer gave him, apparently, some of these. The letter only says It references an account I know nothing about account holding company I presume. Scam Scam Scam Scam, Scamity Scam!

February 3, at 9: I sold lots of Is it a wash sale and how do I handle it, if it is? What are the bases for the 24 and 70 shares sold and the basis for the remaining 31 and shares? What do I put into Quicken this year? February 4, at 4: In net issuance, you never see the sale.

You were promised shares but you only receive 60 shares upon vesting. Just make a note of the price for your 60 shares. When you sell your 60 shares later, the price difference will be your capital gain or loss. February 9, at 2: Getting involved with my taxes already and was reading your comments from this and prior years. My only comment about RSU and Turbo Tax is that TurboTax does fine when you have vested and sold in the same year.

The difference of course is capital gains but it wants to treat it as compensation. You think you can simply treat the sale as a regular stock sale and it prevents you from doing so because it asks you how you obtained the stock. That was the price of couse that was used to compute your earnings which appeared in your w2 years ago.. Does this make sense? Otherwise TurboTax wants to treat the cost basis as compensation and you were already taxed on that..

February 16, at 7: Question that I may be overthinking…In early my husband was awarded a stock equity grant of 1, shares to be vested over the next 4 years. In June , his company was sold and all unvested shares were vested and paid in cash through his employer. The income from the sale of the stock was reported on his W2, but we did not recieve a and one was not produced. Do we just report this as W2 income when completing our taxes? Do we have to complete a schedule D? February 16, at 9: February 20, at 5: I was awarded RSU share this year, but my company withheld shares to cover the tax situation.

Do I have to claim the other shares on Schedule D or worry about AMT? February 24, at 4: TFB, thank you for this article. My shares were taxed as described in the Net Issuance section above. The W2 that my company sent included the income for the total shares issued in box 1, but the shares withheld for taxes were not included in boxes 2,4,or 6.

Am I right in thinking that my W2 in inaccurate and I should ask for an amended document from my employer? February 24, at 8: Harold — How do you know they are not included in boxes 2, 4, and 6?

Get all your paystubs during the year. You may find that one of them has a higher withholding amount. Or you may see the YTD number jumped magically as if you had a hidden paycheck. I like the deconstructed portfolio example, very eloquent.

It appears to be, since the bonus portion is taxed on the W-2 which is why the company does the sell to cover with the stock, to fund the tax from this bonus and then separately your gain on sale of your investment is taxed on the Sched D.

That feels like triple taxation to me! March 4, at 3: TFB — I should have included an explanation for that. I left the firm in and had no income from them other than the vested RSU shares. So, the RSU amounts were the only ones on the W2.

The company tells me that the tax was reported on a UK equivalent I was an expat in London at the time the RSUs were granted, but was back in the US when they vested. They are looking into it.

Thanks for your comments. March 4, at 6: If you see the difference between the market price and the option price reported on your W2 as a code V in box March 7, at March 13, at 9: I received and sold RSUs this year. I also received a B from ComputerShare where the shares were sold. March 19, at 4: March 20, at 9: Want to make sure I am calculating mine right in Turbo Tax. So in TurboTax I have: Maybe it doesnt make a differnce. Or is this how it works because of the taxes taken out?

Any help would be appreciated to make sure I am entering this right. March 21, at 8: Tyler — You know something is wrong when the stock went up and you show a loss. You sold 68 shares. Date acquired is the date vested.

I was thinking the exact same thing. So that makes sense to only take into account the Thanks again for taking the time to respond. I am truly impressed. April 6, at 8: What is the tax implication for the tax withholding on stock compensation paid by the employer? The stock compensation amount e. Thanks in advance for your help.

Thank you for this. April 7, at Jeremy — I used to recommend doing a zero entry for completeness. That way all shares are accounted for. I added net issuance as a special case for sell-to-cover: IRS accepted my returns without any issues.

Achiu — The withholding is also included in W-2, in boxes 2, 4, and 6. If the withholding is too much, you get the difference back. Ok very confused but I am sure you answered above.

I sold some shares of restricted stock when it vested. My employer withheld shares to cover taxes so instead of receiving 50 shares that I sold I actually received money for I pulled a off the smith Barney web site which showed the amount received the 35 and said 0 for taxes paid.

Since my employer did that is that reflected in my over-all W-2 as income with taxes already deducted? Am I making sense? Employer sells 72 shares for tax purposes so I have 95 remaining. So in the capital gain while filing taxes I just mention xxx stock sold date sold: April 10, at 3: I have a location issue with my RSUs.

I was awarded them in in the UK, then left the co. I have a B for the net proceeds, but no W2 for the withheld shares, since I now live in the US and work for a different company.

Can I report the withheld shares by ticking the requisite box on TurboTax and entering it manually? The result is a full refund, because I only worked for 3 months last year.

Seems to good to be true …. My company granted me a couple of bonuses as RSUs over the past 5 years. The company merged with another in mid and the shares were accelerated to vesting and the proceeds included in a separate paycheck. The proceeds and withholding show up in my W I also got a B from the broker with:.

April 11, at 8: April 12, at 3: TFB, My scenario is kinda similar to Peter ….. If not where exactly do I have to enter it. April 13, at 1: I have a same day cash sale RSU. Turbo Tax Premier is subtracting the value of shares with held to pay taxes from my cost basis in my case reported W2 income. Details Same Day Cash Sale RSU Grant: From all of the examples, I should not have to subtract this and my cost basis should just be the W2 income reported.

April 13, at 8: If not which column has that info? Riz — No specific columns. They are lumped together with other withholding from your salary: To all who want me to work their TurboTax issues: If you need one-on-one help, deposit what you think the help is worth in my tip jar. Thanks TFB, that post made it clear. Now I just have to figure out some non-qual Stock Appreciation Rights SARs. April 14, at 3: Also recd B from Broker, showing trade date SEP, shares sold 42 at Price April 14, at 4: My current plan is to correct everything to FIFO now and not think about last year unless I get audited.

April 14, at 9: My question relates to wash sale rules. I did not recognize the losses in , because I thought the wash sale rules disallowed them. Does it matter that the number of shares I acquired is less than the number of shares I sold at a loss? The broker statement shows a gain, because it does not reflect an increased basis due to the wash sale disallowed loss. Any help would be appreciated.

April 15, at 1: How do I calculate the cost basis on the return? I was never sent an updated W I guess these shares are NOT RSUs anymore after the vesting date. Therefore I would not enter them into my tax software as RSUs, but as normal stocks.

As for the cost basis, someone explained it like this: April 15, at 4: TFB-Reader — Answer is B. Cost basis is tied to the number of shares. Great information about RSUs and the tax treatment thereof! My question stems from the way the value of the stock I received is reported on my W I think I need to add the total value of my RSUs into my reported wages.

April 15, at 6: Yes the value of vested RSUs should be in Box 1. However, the Box 1 number is after k and other pretax deductions. April 16, at 5: April 18, at 9: April 18, at LAB — Sorry I have zero experience on the employer side. From my observation as an employee, sell-to-cover includes necessary amount for federal, state, SS, Medicare, and state-mandated disability program if your state has one , just like a one-time cash bonus except no deduction for k contributions.

April 28, at 8: Still a little confused. I can infer this because my B does not have anything related to the RSUs. So to me, I am just getting issued shares of stock. The value of shares is reported as income, and the value of shares is withheld as tax. OK all that is fine. If so, do wash rules apply? If so, when do I get to claim the loss? April 28, at 5: Not clear how it figures into the calculation.

Kbiz — I will tell you if you share some of the money your client pays you. May 3, at I am not charging the client for anything — not preparing a tax return nor providing a fee for service. Was just looking for clarification…no problem for not answering…. June 28, at 9: Thank you very much for your informative article. I just have one question. How does the IRS value restricted stock paid to non-employees? The amount the stock was when recieved, or what the stock is at now.

October 21, at 6: Thanks for your informative article. In relation to RSUs, when are shares deducted from the number of available shares — are the shares deducted when the RSU is granted, or at the time the RSU vests? December 13, at Great website, very helpful. Quick cost basis question for RSUs in a net issuance situation. Your guidance indicates using the closing price of the stock on the day it vests for the cost basis of the remaining shares after net issuance.

December 13, at 2: March 1, at These restricted shares are part of an employee restricted share award. I decided to upgrade to Turbotax Premium for the upgraded stock reporting features and it reports the Cost Basis as zero. March 2, at 9: I think you are asking for the FMV price, correct? So on the release date of April , 50 shares were sold. When I click details, it tells me that the FMV per share was According to a turbotax agent, the restricted stock option in turbotax is for stocks that have not yet vested.

To me this seems real confusing. March 2, at 1: John — Yes, vesting and release are the same: You did it right this time. March 14, at 3: March 14, at 5: Man this is confusing. March 16, at 4: Why would this be? My B does not indicate RSUs anywhere on it so technically I think I can call it a stock sale if that results in lower taxes.

Also note that the RSUs that vested were included in line 1 of my W2 but not noted elsewhere as vested RSUs. Am I doing something wrong? March 17, at RSU vested, tax withhold and received deducted shares, income and tax reported on w-2, no B reporting for them. But, do i need to report this transaction in my return? When you sell, use the price per share used to calculate your income on W-2 as your cost basis.

March 23, at TFB, Can you clarify how to calculate the Cost Basis for Net Issuance? Sorry, if I missed it…staring at Tax forms for extended periods of time is numbing my brain.

March 23, at 2: March 26, at TFB, thanks for the reply. March 26, at 4: TFB — That is what I needed to know. March 28, at 7: The RSU post was very helpful and got a significant issue squared away for me. Have a hybrid of that issue also. Have an noncovered sale of 12xx shares. The shares came from 2 ESPP lots purchased in May and June , and an RSU lot released in October Company was bought in late October , and the shares were converted to 6xx shares of new company. Stock then splits 2: Question is how to figure basis.

Do I trace each lot individually I have basis from each individual purchase from purchase through merger and split, or should I calculate the basis for the entire lot after the merger and then split?

March 29, at 8: Slight twist on RSU issue… I was granted RSU shares and they vested And it may be an issue with how TT handles the RSUs?

Thanks for all your comments. This site has saved my sanity. March 29, at 9: Donna — See my reply on March Just use stock sale. TurboTax is confusing you in the RSU section. March 31, at Think of it as just extra withholding from your regular paycheck. You will get it back as tax refund if it turns out you paid too much tax. April 2, at 5: Thanks for detailed explanation.

Lets say company granted RSU to be vested over 4 years. In 1st Year I got shares out of which I see only 60 sellable shares in the trading account and remaining 40 were sold for covering taxes. How will I claim the 20 shares amount in refund. April 2, at 6: Siva — Nothing special to do.

The 40 shares worth of withholding is already reflected on your W If you paid too much, you will naturally get the difference back.

Think when you get a cash bonus, which the employer is required to withhold at a higher rate. If it turns out to be too high, you get the difference back when you file your taxes.

From the shares, share were sold to cover taxes. Have you encountered this scenario? April 16, at 2: I am US citizen, working in India and earn wages in India.

Since I do not receive any wages in US I do not have a W I did not receive a from the brokerage firm as well. But I did receive the RSU release and the tax withholding details.

It indicates that there is a Now I am not sure whether the tax withholding is for US or for India. Please let me know if my reporting is correct. April 16, at 6: I understand the So the RSU during vesting was taxed for India FBT. Since I did not receive any income in this do I report this vesting in my Schedule D? April 16, at 7: Bala — Sorry I have no idea how you are supposed to report taxes withheld and paid to India.

April 19, at 7: Ok — you may have answered this — but I am still bit confused! Since they lapsed in , and i had then in shares…this is a regular stock sale…correct?

And then what is the determination in Schedule D of Short Term? Yes — this is from ! August 17, at 8: August 17, at December 22, at 1: Using Turbotax and trying to amend a return. I have everything except for 2 questions: What do I do if the income on one of the lots sold in was put onto a W2 rather than a the date sold W2. Do I just complete the amended return with the error in it? Any suggestions would be appreciated! January 14, at This article and the follow-up conversations have been a wealth of information.

I had an RSU vest last December. Right or wrong, I chose to pay the taxes out of pocket and keep all of the shares. I paid this to a brokerage Merrill Lynch. Looking at my pay stub for that period, I see an entry for RSTR STK TAX OFFSET for the dollar amount of the taxes paid. This was, for some reason, added to my YTD Earnings. Am I missing something? January 14, at 7: RSUs were granted to me in when I was a resident of Wisconsin.

A year later during the 3-year vesting period, I became a resident of another state having no state income tax. The custodian withheld Wisconsin income tax on the RSU distribuiton even though I was a resident of Washington State. My question is whether it was proper to withhold Wisconsin tax due to the fact that I was a resident there when the shares were granted even though I was a resident in a different state at the time of vesting. January 31, at Please give me some advice.

I know W2AV for inctive options stock. What W2 box for Retricted Stock Vesting? January 31, at 3: These RSUs vest every 3 months. I still work for the same company. I started working at this company in I moved to India office in separate entity of the same company and although i joined there as a new employee, i get to keep the unvested RSUs and they follow the same vesting rules, and finally i had to move back to US Nov and start working at the same office again.

February 25, at 3: Basically, the difference between my income and taxable income was the total proceeds from my stock sales. So, i amended my return. No biggie, Turbotax desktop download, efiling was obviously closed was really good at walking me through what to enter, and everything broke even again as expected.

How many stocks vested? How many shares were withheld to cover taxes? Yes, it was reported on a No, the cost basis was not included, but I can find this within my etrade account details. Date of sale, net proceeds, and date acquired are obvious.

However, I DID have shares withheld at vest to cover taxes. No matter how I enter this number, either the IRS owes me a bazillion dollars, or I owe the government a bazillion dollars. The total W-2 Income was also included in there. I paid my taxes during vesting period through my account instead of paying through stocks. If so can I use turbo tax to do it. Any suggestions would be of great help. I work for a company that switched to stock awards as RSUs which mature over 5 years.

In the last several years now that the RSUs have been in place — loyalty, respect, job security, balance of personal and work life have become miserable. But, to now leave means leaving a lot of money behind RSU revert back if you leave or are terminated. This becomes a huge beating stick for the corporate management team. Have others seen this in your companies where RSUs are part a big of the compensation?

August 3, at 4: Initially, I was thoroughly confused on what to do as even IRS helpline was not that helpful. Luckily, found your post and successfully filed my tax returns. Appreciate your help for posting this article to help every one. August 8, at 1: If I had shares vest in 1st quarter and company covered and I had 87 shares left, if I sell the 87 remaining shares 6 months later are they taxed again when dispersed to me?

Or is only the amount of the gain in the stock price from the date of vesting to the date of sale on the remaining 87 shares taxed on payroll? August 9, at 8: Karol — The latter. Only the amount of the gain in the stock price from the date of vesting to the date of sale on the remaining shares.

You basically bought those shares with your after-tax cash bonus. March 10, at 9: Harry, great work and thanks for explaining something that I have been trying to understand for many years. The RSU articles are great. I am pretty sure I understand the RSU wht mechanics but am getting tripped up when I compare to stock option activity. I have both showing on my B. My company take the net issuance approach on RSUs and I sold the net shares distributed to me a week or so after receiving them all occurred in same year.

I tend to view the allocation of the total FMV of my award into two pieces — the shares I actually receive and the value of the withholding paid to the IRS on my behalf. My for this makes sense to me. Where I am getting confused is that I exercised stock options this year for the first time.

All of this shows up in my W-2 which makes sense to me. It makes sense that there is no gain or loss on the sale of the shares since I did not hold them long enough to allow price fluctuation but I would have thought in order for me to be credited for withholding taxes which I was , the shares I was able to sell after exercise should be lower same concept as the RSU net issuance.

My shows the sale as shares even though it shows the net amount of shares for the RSU sales. So, it makes sense that my basis and sales proceeds should be the same on the sale. I think I was just confused since my basis for RSUs were based only the net shares received whereas for my stock options my basis was based on the total number of shares.

The difference seems to be that the sales proceeds for RSUs were also based on the net shares and for the stock options based on the total number of shares. Sorry for the confusing discussion but thought I would post anyway in case you had any different view or if it would help anyone else. April 11, at 2: I sold restricted shares last year.

These shares were not purchased by me. Anyway, they were originally awarded at a much lower share price than when I sold them.

Not sure if I should see a tax specialist. April 11, at 9: The award was already added to your W-2 at that time. It would be the same as paying you cash and having you buy the shares. November 10, at 6: One thing that is puzzling is if I get RSU that got vested and for simplification I just hold on to them.

I am still paying taxes twice. At the time when they are vesting, certain RSU and sold to cover tax. When I file my Tax Return in year vesting happens, all vested RSU income is added to my W2, including RSU that were sold to cover tax. This part is not true: January 13, at Informed that as of the cost basis on for stock options we purchased will be what we actually paid instead of what the market price is on day of purchase.

This is the first year IRS is doing this they said. Shares held at Merril Lynch. Said my accountant would have to adust cost basis. I have seen my and he was correct it is showing 52 instead of 75 for cost basis. My accountant does not know what she needs to do to adjust it. I have tried several accountant and they donot know either.

What should we do since that is a huge difference since we got shares that we purchased at the lower price in the stock option. This is driving my crazy. I believe this change affects stock option exercises and ESPP, not necessarily RSU. This article is about RSU. March 3, at 8: What does this mean to you?

On that page itself, the cost basis listed for each lot was the same as on the B. March 3, at 9: This article is about RSUs, not ESPP. For a step-by-step guide on how to report the sale of stocks from RSUs in TurboTax, see Restricted Stock Units RSU and TurboTax: Thank you for such a informative piece. You had saved me THOUSANDS this year! The B has reported 0 in Box 1e Cost or Other Basis on the RSU sales transaction.

While using Turbo Tax to import the B the whole amount of the proceed has been treated as Gain. Only by the end I am getting suspicious the substantial tax return amount difference churned out by TT than the last year then I noticed this problem.

In my opinion Turbo Tax drops the ball big time here. April 4, at 8: This may have been asked, but can you PLEASE assist me?

My organization awards us several performanced based RSU awards throughout the year, which are taxed and a portion of shares are held for tax purposes. In I sold a significant number all under a year. My new accountant was going off my and the Capital gains were through the roof and the cost basis was blank. My question is how do you calculate the cost basis?

I thought the cost basis was the stock was at the time of vest x the number of shares. Thus the gain or loss would be the number of shares x the stock price at the time of sale. Again, I sincerely thank you!

Daryl — The correct basis is the per share price on the vesting date times the number of shares sold. If the shares sold came from multiple vesting dates, you will have to break them down and add them up.

See the linked article under 1 Net Issurance for how to do it in TurboTax. It will give your account some clue for how to do it in his or her software. April 8, at 8: Thank you for this site! I have a corner case question. I am an American employee of a European firm posted Germany.

My RSUs vested last year and the year before , and are held in a German bank. I was doing my taxes by-hand, blissfully leaving out RSUs since I was not doing anything with them — which is why they were easy to do! Started using TurboTax this year after I learned about the RSU tax treatment and came across this page. But what do I do about the year before? If you need to add this income for previous years you can always amend your returns.

The salary statements here are inscrutable and I could not figure this out, so I broke down and asked around Payroll did not know what I was asking! And look into amending for the year prior. Either way, I see an extension request in my near future. Does IRS do that automagically? April 12, at My B does not report a Date of Acquisition Box 1b or a Cost or other Basis Box 1e. I assume the Date of Acquisition is the same date as the sale date?

The cost basis is unclear however. Since this is RS an employee award , the shares were not purchased by me. So if these shares were awarded not purchased , would the cost or other basis be 0 since I did not purchase? Or would I find the cost or other basis by multiplying the FMV of the shares at the time of award by the number of shares? The Date of Acquisition is the date the shares vested. The cost basis is the price on the vesting date times the number of shares sold.

And its also not clear whether I have an RS or an RSU. My year end stock plan summary says the Grant Type is an RSU. But the description in TurboTax sounds like an RS employee award for performance. Your rights to the stock are restricted until the shares vest.

April 14, at 5: So I chose the RSU option. The only question I have left is that on one of the screens in Turbotax, it asks for the following information:. Are these specific to the sell to cover situation? According to my statement, shares were released on April It also says that 64 were retained. April 14, at 6: I started the above sell to cover report by reporting a sale of stock under an RSU plan. Initially, Turbotax walks me through the net proceeds calculation date sold, shares sold, selling price per share.

Total net proceeds are calculated minus commissions. August 17, at 1: I have restricted stock units for Company A private which has a parent company B private. My stocks vest every year. After 2nd year the parent company B said that the Company A is dissolved.

There is no payroll running for Company A right from the inception. Company B being the parent was running the payroll. When I have requested the price for the vested stock for the two years which I was supposed to get they said the company A is dissolved I will not be getting any money. What can be done in this scenario? January 10, at 2: My company vests my RSU award on April 1 or other quarterly dates , but we have a closed trading window that does not allow me sell the stock vested within that grant except for 30 day intervals starting after the earnings call at the end of the same month.

Thus, effectively, my actual award stock that can be sold for monetary recompense might be legally mine on April 1, but the basis for income seems like it should really be the FMV of the stock at the opening of the trading window. My company performs what amounts to the Sell to Cover that you mention, taking away of my RSU and giving that to the government to cover payroll taxes.

January 10, at 9: You will have to explain to legislators and get them to change the law. You can only go by what the law says. I had restricted stock that vested in July, and this award is all new to me. I just got my W2, and was surprised to see it was counted as income. Unfortunately the company did not sell any shares for withholding, so now we are looking at a HUGE tax payment to the government.

We decided to sell the shares to pay for our huge tax bill, but they withheld half the shares for withholding at the time of sell. Where do I find information on this situation? February 5, at Hi, I had vested RSU and ESPP shares which I sold in The company withheld shares for taxes upon vesting.

I believe from the sales that these have been reported in my W-2 as additional wages. Also in I had a bad year trading and have a good chunk of capital losses. Is there any way to apply those capital losses to offset the income gains from the RSU and ESPP reported to my W-2? What baffles me is the impact on AMT — what amount is used on line 17 of the Form in the calculation of AMT? Is it the cost basis at the time of the vesting, selling date or at the end of the prior tax year?

Any help would be appreciated — thank you. March 27, at 2: This is the first site to explain RSUs succinctly and in a manner I could understand and apply to my taxes. March 28, at 6: This is a great post!.

How to Report RSUs or Stock Grants on Your Tax Return - TurboTax Tax Tips & Videos

How do I enter these in TurboTax? Thank you in advance. See if this helps from TurboTax: How do I report RSU dividend equivalent payouts in turbo tax? March 31, at 6: Thank you for the article. My first time dealing with RSU.

I do not think that the shares were included in my w-2 but my husband does. How would I know? Just ask my company? Your email address will not be published. Notify me of follow-up comments. Send me future articles by e-mail. About The Best Of My Book Contact Everything. Restricted Stock Units RSU Sales and Tax Reporting by Harry Sit on February 25, Comments. FREE E-mail Newsletter Join over 3, readers and get new articles by e-mail: Comments Anonymous says February 27, at 1: For the 39 RSUs sold for tax withholding, on Schedule D: In , three relevant transactions occurred: Jan07 — Some shares vest and a sale to cover occurs Mar07 — Sale remaining shares from those that vested in Jan07 Dec07 — Additional shares vest and a sale to cover occurs I received documentation for all three transactions, but I only received one B and it just covers the Mar07 transaction.

I was lost in TurboTax until I read your post.