How do we address the withholding tax issue deducted on account of automatic sale of VMW shares? VMW classified it as dividend which ideally isn’t! I contacted ETrade and they cannot do anything about it.
Fix when you file. There probably isn't anything to do about what has already happened. But some companies allow you to adjust withholding on future vests. It's late in the year so fixing on your tax filing is probably the fastest solution anyhow. And what do you mean they classified it as dividends? At the end of the day it is just income.
Okay thanks, I’ll check while filling returns. They classified the 50% of VMW stocks which came in as cash as dividend for which withholding tax was charged. It’s actually the sale of shares and not dividend.
Hey buddy. Were they RSUs , we are being taxed twice. What to do? The RSU were granted post tax deduction. And now they are taxing the cash component as if it was money being handed out. Cost basis is reflecting zero for the stocks as well. Considering all the 100% money as capital gain
Yeah they were RSUs and I had the same question. I think you can get some refund while filing for tax returns.
If VMW classify as Sell stocks will the tax will not deducted then?
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I thought that withholding was to cover the cash part of the deal. Some 52% of your vmw would have been sold, tax is withheld for the gains and broadcom shares are bought with the remaining amount
It’s classified as dividend for the 52% of VMW shares that are sold. They are actually sale of shares and not dividend. I was informed that withholding tax is only charged for dividends. Is the withholding tax charged for sale of shares as well?
Regardless, you can just file 1040NR end of year and get back the extra tax you've paid