Can I enter a 1099-B with a Code E and an Employee's Code B for W-2 Income in the same transaction?

[2084]

I have been trying to enter these: Code B on the Employees Compensation Worksheet and Code E on the Capital Gains Worksheet.  They Conflict with each other, and I get no Employee's Compensation when I enter the Code E.  When I enter the Code B I get no Capital Gain or Loss.  When I have Both entered, I get no employee compensation.

[Accountant-Man]

Why are you entering W2 income in 1099B?

[2084]

Hi!  You enter the amount of compensation (Stocks Basis) to offset the amount that is taxed on your w-2 box 12 for sale of employee stock.  The 1099 B shows 0 basis, so you have to adjust the basis to the amount that was included in the employee's income when they "purchased" the stock instead of cash wages.  Clear as Mud???  I just thought of another thing to try in the morning! I'm going to enter the same transaction twice. Once as a Code E and once as a Code B.  Wish me luck!

I know and it's driving me crazy. I have one set of info from the company and one set from the 1099B and trying to get them to mesh together is a real bear.  I had 31 transactions to enter and have gotten all correct except the last four.  These seem to have a mixture of the 2 codes E & B and both instructions that I have from the company are all in different order and terminology on both are completely different. This is on all 31 transactions.  I have 3 sets of paper information and none of them are in numerical order. then the terminology on the tax program is completely different from the company.  Sorry I'm venting! I've been working on these for a few days!  and nearly done!

[Skylane]

This is the 3rd post on same issue? First it would be helpful if you only enter 1thread or link them together so you don’t confuse the people around here….

this is sale of of rsu’s or nq’s? 
on the w2 you have an amount in box 12 V?

if so, this is the amount of income for the transactions that have already been grossed up into box 1. (You can verify this with clients 12/31 paystub). The transaction is taxed as ordinary income. 
the 1099b (s) do not generally create a gain or loss. Summarize them them by type (E,F… whatever and use the adjustment field so gain is zero. Then attach pdfs of the 1099bs that you received to efile 

[Skylane]

…. As 8949…. 
it sounds like your client has been accumulating these over a long period of time and just cashed them all in.  You do not have to enter all the 1099b transactions individually 

[2084]

Thank you Skylane! That advanced me somewhat and actually I did try entering the same sell twice. On one I used the Code B and the second one I used the Code E I just have to sort through the Schedule D tomorrow and hopefully it didn't enter an extra sell.  What a learning curve. 🐵 

[qbteachmt]

"They Conflict with each other,"

What does that mean? They are each separate and stand alone. A W2 and a 1099-B are separate reporting forms.

The W2 has the taxable value at issue/vesting, so that is Basis.

The 1099-B is because someone sold some of this. That happens, for instance, to cover the withholding taxes due on the vesting. The employer might have a provision to do this inhouse, or they outsource that to a broker. Or, the owner sells later. Either way, it's the same as any sale.

You don't enter the same one twice. Enter the W2. Then enter the Sale, no differently than if any other stock other than the employer's stock, was the sale. Yes, you have to provide this person's basis from their vesting value and date(s) if it isn't provided.

And yes, you keep starting new topics, but it's the same community you already asked. It helps to keep it to one place, so everyone can see what is already being discussed and provided.

[2084]

Accountant Man:  I am entering on the Employee Stock Transaction Sheet Code B to adjust for the amount  of  income that the employee regular income that the employee has already been taxed for in his W-2 Box 12. The only way I can get to the worksheet is through the Capital gains adjustment worksheet which sends me through to the worksheet for employee compensation.   Also, I have to Do an adjustment on the Capital Gains Adjustments Worksheet under Manual adjustments for Code E.  Option premiums.  I did try to enter this twice to get the separate codes for each but it didn't seem to work but still researching that method! Hope this answers your question.

[2084]

Sorry you didn't understand me.  I understand the concepts that you are talking about but my problems is with the data entry int the program.  When I go to the adjustment codes, the results are not flowing through to the Schedule D or to the W-2.  Also I apologize about the double posting, I have no idea what I did to make that happen.

[qbteachmt]

This topic, near the bottom, has the 1099-B RSU adjustment info for you:

https://proconnect.intuit.com/support/en-us/help-article/form-1099-b/methods-entering-stock-transact...

No, it won't adjust the W2. The W2 won't affect the Sched D or the 1099-B. You have a sequence of events. You have two separate events.

1. Someone has the right to the stock. When it vests, that's the date of FMV to payroll and to be taxed through payroll.

2. Someone sells stock. This is no different than any other sale. You might need to look up the basis by reference to the vesting and any sales expenses, like any other sale of stock.

[2084]

Thank you! I am going through the article you gave me and will try that. I think I still have a problem with the W-2 income.  It seems like my client would **bleep** his w-2 wages. This year 28 of the transactions flowed through.  I am just having problems with the remaining 5 because of the two adjustment codes on them:  Code E and Code B?????

[qbteachmt]

Code E and B on a W2? I don't know what that is. Which box?

Or, are you asking about the 1099-B, and the way it is handled on Form 8949, which would be short- or long-term? See the Line 1 instructions:

https://www.irs.gov/pub/irs-pdf/i8949.pdf

[Skylane]

@2084 this shouldn’t be so difficult. Could you state the code and amount in box 12 of the w2 please.

[qbteachmt]

I don't understand this, either: "I think I still have a problem with the W-2 income."

Why? It's a form. It stands alone. You enter that form. You don't adjust anything on that form. Sales or no Sales do not affect that form. It's Payroll.

These two forms (W2 and 1099-B) are not going to adjust each other. They don't relate.

[2084]

Hi Skylane!  My Error!   Box 14 codes are RSU $61,154.00 and ESPPDD $2422. Both say other (not classified).  It was not Box 12 but 14.  

[2084]

Me again Skyline!

Maybe more info than you need but the codes on the Form 1099-b are:

Form 8949, Part 1 with Box B checked

FORM 8949, Part 2 with Box D checked

FORM 8949, Part 2 with Box E checked

However on my data received from the employing company some of the transactions both box E and Box B checked. These are the ones that I am having the entry problems.

[qbteachmt]

Box 14 is informational. It explains some of what is already in Box 1.

ESPPDD = Employee Stock Purchase Plan, Disqualified Disposition. That's informational. It's here:

https://turbotax.intuit.com/tax-tips/investments-and-taxes/employee-stock-purchase-plans/L8NgMFpFX

They sold some stock earlier than the holding requirement.

The RSU info is Basis. The basis as of the vesting date. Those are not by definition the shares sold. Although some are sold to cover tax withholdings, when base salary (or a bonus) isn't going to cover the taxes. That likely is the DD sale, in fact. Someone would have provided a settlement sheet from payroll or the ESPP (plan); you should have more than a W2.

Try this topic to understand how dates matter:

https://turbotax.intuit.com/tax-tips/investments-and-taxes/how-to-report-rsus-or-stock-grants-on-you...

[2084]

Skylane, To Clarify, mainly the ones that have both B and E adjustments are not passing through the system as they should. The totals don't pass through and add up to the proper amount for the W-2 income.  Either or, the amounts on the 1099 B adjustments are not passing through to the 1099 B.

[qbteachmt]

"The totals don't pass through and add up to the proper amount for the W-2 income."

Did your taxpayer tell you they sold only shares that are vested in that same year? You cannot rely on trying to match to a specific year's W2, if your taxpayer has had shares across many years.

[Skylane]

Have you compared the W2 with YE payroll stub? Did they gross up the W2 for the sales?  

So, no entries in w2 box 12 relating to sale? Did he receive a separate check for the proceeds, that were not included in the w2 income?

Box 14 is informational as @qbteachmt stated

[2084]

Hi Skylane!  Sorry I didn't get back to you yesterday. Crazy Day!  I actually took out the E expenses and am going to put them in with his employee business expenses for the State, they were minimal.  Talked to client about it and he's bringing me some additional information about the W-2 box 14 from his Company.  Evidently the information I have entered had nothing to do with the Box 14 total, as it did in prior years, and what he's bringing me from corporate matches the figures on the w-2.  However, all is not lost because I can still use the information I have already entered to offset the w-2 income.  It's hard to explain when I'm working with two totally different entities and languages being IRS and Corporate. However, it will probably take me an hour to find the information sheet I need to fill in grants! I've seen it in passing at times, but don't recall which form it was attached to. thanks for all your help and you might be hearing from me again, although I hope not! 🐵  2084

PS Thanks for your help and Thanks for sticking with me! 

[2084]

Thanks!  My Client brought me in some more info from his employer last night. It was for Grant information which my client received in 2022 and surprise! It actually had the matching number as the w-2 information for compensation income.  So, it looks like he has about $50,000. in sale of stock compensation and another $60,000 from the Grants.  He received these grants in 2022 and they were not sold and I am now trying to find an input form to add in the grant data and include the compensation in the w-2 income. So far I have had no luck.  Can anyone direct me to get to the worksheets that I need to get to so that the data will flow through to the w-2 compensation worksheet?  Thanks!   2084  

[qbteachmt]

"to add in the grant data and include the compensation in the w-2 income."

It would already be part of the W2. You don't keep adding more info that is W2 info. The employer would already have done this.

Did you get the year end paystub where the various pay items should be itemized, so that you can see Salary, bonus, and other Wage items, differentiated from taxable grants and vesting and whatever else this person might have (retirement, child support garnishment, etc)?

Grants vested, and not sold, means that stock will be held to act as reference for Basis, later, when they are sold. That's why Sales in 2022 are not by definition what was taxed on the W2 in 2022. Just like any other holding, there can be short-term and long-term.

I wonder if you need to break this out into projects. You seem to have ESPP, RSU, Grants and Vesting, and Sales. All of that is separate.

Anything taxable through payroll is already on the W2 for the appropriate and specific year. That's because an employer cannot give value to the employee that is tax free. You don't keep adjusting a W2.

Being given rights to purchase company stock, if your taxpayer didn't exercise that right, means there is no ESPP amount.

Stock might be sold to cover withholding, as explained already. That 1099-B might be from inhouse sales (through payroll) or not. But your taxpayer has the right to sell anything they own or are vested in, too. That's 1099-B. That's not through payroll. It doesn't change W2.

I am still worried about everything you think needs to adjust something else.

[2084]

Thanks So much for your input I am understanding more now.  What really threw me off was that I received the 1099 **bleep** the figures in Box 14 W-2 I will get the final pay stub.  It's been a difficult concept for me to absorb.  I will get the final pay stub from my client also. I will leave you alone now 🐵 Thanks for your patience with me!