Here is a dumb question.

I sold several SAR's and RSU tranches this year.
I sold Net Stock so taxes were withheld and these sales are reported on my Company W2.
Within a week I sold the stock and invested in ETFs

I got a 1099-B from Fidelity and the 1099-B shows capital gains of like $50K mixed between short and long term.
Further down in the form is a supplemental schedule which shows proceeds and cost basis basically the same and loss/gain of the week I held it for.

That supplemental is what I put on my taxes correct, otherwise I would be doubled taxed on the proceeds from the sale.

Why can't brokerage firms make it easy to do....

TXAGGIES said:

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Here is a dumb question.

I sold several SAR's and RSU tranches this year.
I sold Net Stock so taxes were withheld and these sales are reported on my Company W2.
Within a week I sold the stock and invested in ETFs

I got a 1099-B from Fidelity and the 1099-B shows capital gains of like $50K mixed between short and long term.
Further down in the form is a supplemental schedule which shows proceeds and cost basis basically the same and loss/gain of the week I held it for.

That supplemental is what I put on my taxes correct, otherwise I would be doubled taxed on the proceeds from the sale.

Why can't brokerage firms make it easy to do....

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I'm confused. The 1099-B shows capital gains of like $50k or does it show sales proceeds of $50k?

It showed capital gains of 2 different amounts in different sections

Here is what I see on the form

Form 1099-DIV
1a $xx,xxx
1b $x,xxx
etc

Form 1099-IND
1
2
3.

From 1099-B* (Short Term)
1a
1d proceeds 59,892
1e Cost basis $43,935
Gain/Loss 15,956 (Short Term)

From 1099-B* (Lon Term)
1a
1d proceeds 35,128
1e Cost basis $0
Gain/Loss 35,128 (Long term)

Those proceeds are reported on my W2 though.
Further down I see a summary schedule

Short term
Proceeds 59,892
Adj Cost Base 59,951
Loss (60)

Long term
Proceeds $35,128
Adj Cost Basis $32,790
Gain 2,338

I think that last loss/gain is all I need to put for capital gains correct? I entered the 1099-B in tax software and it appears to be double counting the proceeds (in my W2 and the gains)

My only experience with this sort of thing has been with ISOs and in every case the person sold the underlying stock immediately upon vesting. If memory serves me, they were disqualifying dispositions (didn't meet the holding requirements) so there was a gain reported in their W-2 and the 1099-B reported short-term sales, typically at a loss due to sales commissions (basis included the gain reported in the W-2). The bulk of the income when sold immediately like that is in the W-2.

Some brokers reported this correctly (typically the discount brokers with an established relationship with the company, or so I remember), but for some we had to determine the basis ourselves.

But never do I remember seeing what you have, i.e. the vastly different cost basis between the sales information on the 1099-B and in the supplemental information.

I have the exact same setup. The 1099 basically has no cost basis as if you'd gotten the shares for free. You did in a way. But the income was on your w2 and already paid taxes. You have to include the grant or vesting price in your taxes to avoid getting taxed again. And depending on the price when you sold it, there may be loss or gain.

Also agree that's its ridiculous that the brokerage doesn't report it better.

There's a place on form 8949 and schedule D to include an adjustment that's basically the total amount you were granted. Then that's subtracted from the sale price from the 1099.

Also be glad yours in all in USD. Ours starts off in Swiss francs.

kyledr04 said:

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There's a place on form 8949 and schedule D to include an adjustment that's basically the total amount you were granted. Then that's subtracted from the sale price from the 1099.

Also be glad yours in all in USD. Ours starts off in Swiss francs.

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not subtracted from the sales price, but ADDED to the BASIS.

same result, but just wanted to make sure there is no confusion on HOW you show it.

TXAGGIES said:

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From 1099-B* (Short Term)
1a
1d proceeds 59,892
1e Cost basis $43,935
Gain/Loss 15,956 (Short Term)

From 1099-B* (Lon Term)
1a
1d proceeds 35,128
1e Cost basis $0
Gain/Loss 35,128 (Long term)

Those proceeds are reported on my W2 though.
Further down I see a summary schedule

Short term
Proceeds 59,892
Adj Cost Base 59,951
Loss (60)

Long term
Proceeds $35,128
Adj Cost Basis $32,790
Gain 2,338

I think that last loss/gain is all I need to put for capital gains correct? I entered the 1099-B in tax software and it appears to be double counting the proceeds (in my W2 and the gains)

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you will show this 8949 box B (ST) and E (LT)

box b will look something like this

Stock desc - Date bought - Date Sold -Proceeds 59892 - Basis (0) - ADJ (59951) - Gain (60)

Box E

Stock desc - Date bought - Date Sold -Proceeds 35128 - Basis (0) - ADJ (32790) - Gain 2338

the dividends and stuff reported like normal.
everything else will be on your W2

kyledr04 said:

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I have the exact same setup. The 1099 basically has no cost basis as if you'd gotten the shares for free. You did in a way. But the income was on your w2 and already paid taxes. You have to include the grant or vesting price in your taxes to avoid getting taxed again. And depending on the price when you sold it, there may be loss or gain.

Also agree that's its ridiculous that the brokerage doesn't report it better.

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I am using supplemental info as that seems most accurate. Cone find me IRS....

You sold before confirming cost basis and acquisition date were correct on your holdings and didn't have them update it before the 1099 generated

mosdefn14 said:

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You sold before confirming cost basis and acquisition date were correct on your holdings and didn't have them update it before the 1099 generated

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Cost basis is when i exercise the option, and i exercised net shares so taxes were withheld and i see it on my W2. So proceeds should equal cost basis if sold instantly. I held for a week before selling but cost basis is still equal to exercised amount which is not what that shows in the top section.

Even though i did net shares the 1099 shows no taxes withheld as they are also on my W2

I often see RSUs and isos not feed into brokerage accounts correctly and need to be manually updated. Sorry, thought that's how I read your OP.

When I had this with RSUs through Fidelity, there was a supplemental calculator in TurboTax that you had to manually fill out each transaction with information that was already on one of Fidelity's forms but wouldn't automatically enter in. I don't know why they did it that way but it was always a chore to do (though very worth it to not give the govt more of my money).