Double taxes on RSU

Oracle
l769als7

Go to company page Oracle

l769als7
Feb 26, 2018 15 Comments

I was doing my 2017 taxes in TurboTax and noted that my RSU were double taxed when using 1099B forms from Fidelity. Like I got some RSU distributed to me in 2016 and part of it was sold automatically by broker to pay taxes. So the remaining part of stocks supposed to be “clear” as I already paid taxes on it in 2016. And in 2017 I sold those stocks. However, the 1099B form that I got from Fidelity in 2017 is showing 0 basis costs for that transaction which means that I need to pay taxes for entire amount again while it should really be paying taxes on gains only. So I ended up with overwriting basis costs with real value and it looks correct now. However, the question that I have is why broker is not reporting correct value on 1099B form? Such form is going to IRS so me overwriting it will increase a chance of getting red flag from IRS and being inspected. Is it just Fidelity or every broker is not reporting correct basis costs?

comments

Want to comment? LOG IN or SIGN UP
TOP 15 Comments
  • Apple
    Elon Musk!

    Go to company page Apple

    Elon Musk!
    Most brokers issue 0 as the basis for rsu. Find the closing price of the lot on the grant date and multiply by no of shares to get the correct basis
    Feb 26, 2018 1
  • Yahoo / Product
    Truth

    Go to company page Yahoo Product

    Truth
    In TurboTax if you go through the option of “guided step by step” it will take you through all the information you need to input including setting the sale as RSU.

    You will then see you tax bill magically vanish as it recalculated.

    My favorite moment each tax year
    Feb 26, 2018 0
  • Figure out your cost basis & report that. 1099b is their attempt at reporting your income. It’s on you to track & report correctly.
    Feb 26, 2018 0
  • Google
    Appie

    Go to company page Google

    Appie
    I've used fidelity and TurboTax and never had this issue. Cost basis is calculated correctly
    Feb 26, 2018 5
  • Oracle
    l769als7

    Go to company page Oracle

    l769als7
    OP
    Yeah I know the basis costs and will be using those. I was just wondering why broker is not using them and using zero instead. That will just trigger some attention from IRS as my numbers will not lined up with broker numbers report ed to IRS
    Feb 26, 2018 1
    • Nvidia
      qwerk

      Go to company page Nvidia

      qwerk
      It’s normal. It used to be that some brokerages would report and others would not. A few years ago, they all standardized to report 0 basis for RSUs. The IRS expects you to adjust them.
      Feb 26, 2018