I have some RSUs that Salesforce sell to cover taxes. I think I got taxed twice. I see it on my w2 and then have a form from E-Trade that says sell was short term capital gains.... That does not seem right. Why would I pay short term capital gains on stock that were sold for taxes? Also... I didn't sell any stock at all.... Just vesting. Did I get taxes Twice and should I ignore the E-Trade form? #rsu #stock
Ask payroll to be sure. But, it's common to sell to cover and then list the withheld amount on the w2.
As others have said, there is a time difference between when the stock is taken to pay taxes and when the actual sale happens. Due to that, you may end up with a small gain or loss. The amount should be pretty small.
Sell to cover % often lower than your income tax bracket. You pay the difference.
Cost basis is 0. Short term gain is $4500
Ok, that definitely like double taxing. I believe shares sold to cover show as W2 income. FWIW, I had the same issue at SFDC. They usually included an insert in the tax statement that covered this.
It is also common for an employer to “sell to cover” at the lowest tax bracket and if you are in a higher tax bracket you will be responsible for the difference.
I thought they do this at the highest tax bracket to be safe.
E*TRADE also has supplemental document with adjusted cost basis. Use that to edit the costbasis in your tax filing.
Thank you! Why do they make it so difficult?
If the stock is very volatile, it’s possible that you can end up with minor gains / losses since the stock vest and the sale to cover are not always instantaneous. FYI, the number on your W2 is income (your entire grant), the number on your 1099 is only gains and losses. You’ve already paid your income tax (when the shares were sold). The 1099 your looking at is accounting for the gain in the small moment between the stock grant and the sale to cover