Intuit_Devin
Employee
Employee

The employee stock reporting rules in many cases require brokers to report a basis that does NOT include the basis they get for the recognized income on W2. When you have this situation, all you have to do is report the sale from 1099B as you normally would, but then enter the "Corrected basis" which includes the W2 income. End result of same-day sales like this is typically a very small loss due to broker fees.

Just FYI, any time you have clients who sell stock acquired from their employer, it's always a good idea to compare the reported basis against the actual stock price on the acquisition date. If the reported basis doesn't fall within the daily trading range for that stock (times number of shares sold, of course), then you most likely have a situation where compensation on the W2 hasn't been added to basis, and you should ask your client if they have additional details about the sale that would show the compensation income from when they received the shares. Some brokers include this in supplemental info at the end of the same year-end document that includes the 1099-B; but many put this in a separate document that the taxpayer might not know to look for.

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