Cost basis wrong ?

[vPackets]

Hi There!
First I want to thank you for everything you did, that's very helpful..... The amount of work and research is crazy and I salute and thank you for that.

I do not know what I am doing wrong but in the spreadsheet I have checked all the ESPP and RSU granted + their granting date.

For my ESPP: The cost basis is always 0 ?

For my RSU the cost basis is quite high and is the results of proceeds (d) - 1099-B Proceeds.

But for example:

I got granted 203 VMW on 06/01/2021 at 161.26 Market value per share

The spreadsheet shows the following:

1099-B Proceed : $13,860.16
Proceed (d): $39,959.33
1099-B Cost Basis: $29,370.04

If I check my cost basis for all my modest RSU assigned and apply them in turbo tax ... the refund from the IRS is going substantially HIGH.

I just want to make sure I understand what I am doing.

Thanks a ton !

[hickeng]

@vPackets

For ESPP the basis is always supposed to be 0.00 in Form8949. For covered securities you must report the same basis reported to the IRS via 1099. Instead, basis correction for ESPP is done via the Adjustment column.

If you set the Display of Form 8949 in Summary!K36 to Cash Only then you'll see the Adjustment is 0.00 for all ESPP lots back to 2014 (I don't have lots before that).

This is because none of the ESPP lots had a tax basis high enough to use the alternate gain calculation (over $128.60 after dividend adjustments). The usage instructions have a section on how to enter this info into Turbotax - it should be similar for other tax prep software.

The Gain column should remain the same, regardless of whether you have Cash Only or Cash & AVGO FMV selected for display. The Gain value is the bit that dictates the captial gain/(loss) that you pay tax on.

Those two ESPP lots show a captial gain of 9353.9, so you should be paying tax on that gain. If that results in a refund then you must have substantially overpaid estimated taxes. Personally I've got a massive refund from CA and owe Fed monies - which makes sense for me as I aimed to meet the Fed and State safe harbor thresholds for estimated payments.