On 9/15/09, I received 1500 RSUs, lets just say at $10 that day. On that day, my company withheld 489 shares for tax purposes, so I was left with 1011 shares. On 12/02/09, I decided to sell the 1011 shares, at a loss even for $9.50. In TurboTax I followed your directions above for the first transaction, as it is the same scenario. For the second transaction, I put in the relevant sale info, and the same vesting lot information. Now, TurboTax is showing me as having an investment loss as it should for the year, but in the section where it asks if the RSUs are reportes on your W-2, I say yes, but TurboTax is saying that the amount it calculates is exactly twice what is on my W-2. I’m guessing that this is because I have 2 transacations listed (which is the case) both with the same vesting lot information. How do I fix this? Any help would be GREATLY appreciated. Thanks again for this info!

This step is for reporting the withheld shares by your company…. I doubt you are in violation… because they withheld the share and put it as income on your w-2. But not sure… ask a tax professional.

Now the shares you sold now are exactly similar to buying shares 2 years ago and selling them now. It’s not a RSU type of transaction… I believe. I have not sold any of my vested RSU’s so not sure about that.

89 shares vested on 05/27/2007
24 shares were withheld by my company and sold on the same day for taxes
65 shares were deposited into my e-trade account
my company reported both income and taxes on the W2
my company did not use the broker for the withheld shares
i did not sell any of these shares in 2007 so, i just reported what was on W2 in 2008 tax year
i did not report the withheld share sale by my company – am i in violation of something?

i sold the 65 shares on two different days in 2009
30 on 10/27/2009
35 on 11/04/2009

How do I report this sale in 2010 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?

Any help will be much appreciated.

Mike in Wimberley

Any further clarifications would be greatly appreciated.

This year, I found out something and I am not sure if it’s because of how TT Premier 2008 works or if it was this way last year too. In any case, here goes:

The last question of Step 7 (shares withheld for taxes?) should be answered as ZERO in your example. There are wo reasons why I say this:
1) My E*TRADE statement reports 0.00 for each such transaction where I only sold in order to cover taxes. The taxes paid are not reported on the 1099-B because they are reported already on the W-2. Otherwise, you are reporting the tax that was paid twice (comes out in your favor but it is not correct).
2) This second reason is what convinced me that this is how turbotax wants you to enter it. My situation is unique in that my company’s stock (very unfortunately) plunged to around $2 to $3 / share. In my first vesting, I had a batch of 17 shares vest, 12 of which were sold to cover taxes (and a disproportionate chuck of that was the $20 broker’s fee). Now, when I fill in all the information exactly as you laid it out (report sale of 12 shares (step 5, second question) and also list those 12 shares as being withheld for taxes in step 7, I get and error from TT that I need an additional 7 shares to cover the ones that were sold. This is because I (correctly reported 17 shares having vested but TT believes that I sold 12 shares after I also had 12 shares withheld (24 shares), so it’s asking me where the other 7 shares came from.

I did not have this problem last year but I believe that may be because this was the first time that I had to sell more than 50% of my shares to cover taxes (and the broker’s fee!) so this issue did not come to light before.

Could you please attempt to re-create a similar situation (> 50% of shares sold to cover taxes) and see if step 7 should be ammended? Thanks.