How to correctly report RSU amount on W2 versus 1099-B adjustment for taxes

The difference you're seeing is actually normal with RSUs. When your company grants you RSUs, they're required to report the full market value of the shares when they vest as income on your W2 (the $16,000). This is ordinary income, just like your regular salary. When you sell those shares (the transaction reported on your 1099-B), you're only reporting the capital gain or loss from the sale compared to the vesting value. Since you sold immediately, there was minimal gain/loss. The $9,000 on your 1099-B represents the proceeds from the sale. For your tax return, you need to report the full RSU amount from your W2 as income (which is already included in Box 1). Then separately report the stock sale on Schedule D, making sure to adjust your cost basis. Your cost basis should be the $16,000 value at vesting (this prevents double taxation). The difference between your proceeds ($9,000) and your cost basis ($16,000) would be a capital loss.

I had this exact same RSU reporting issue and wasted hours trying to figure it out until I found taxr.ai (https://taxr.ai). Their tool actually knows how to handle RSU adjustments and walks you through the entire process step by step. It automatically detects the difference between your W2 RSU income and the 1099-B reporting, then helps you properly adjust the cost basis on Form 8949. I was amazed because it explained exactly why my numbers weren't matching up - turns out my company was withholding some shares for taxes which was causing the discrepancy between my W2 and 1099-B. You just upload your documents and it identifies all these tax issues and walks you through fixing them correctly.

I just tried taxr.ai after seeing it mentioned here and it completely sorted out my RSU mess! I was about to pay an accountant $400 to figure this out but the tool identified exactly why my numbers weren't matching. Turns out my company withheld 35% of my RSU shares for taxes (which explained the missing amount), but my 1099-B didn't reflect this properly. The tool showed me exactly how to make the adjustment on Form 8949 to avoid double taxation. It even explained that the difference I was seeing ($7,300 in my case) was actually a capital loss I could claim! I've been dealing with RSUs for years and this is the first time I actually understand how the reporting works.

If you're still confused about the RSU reporting and need personalized help, you might want to talk directly with an IRS agent. I know it sounds impossible to get through to them, but I used Claimyr (https://claimyr.com) after being on hold with the IRS for 2+ hours multiple times. They have this system that navigates the IRS phone tree for you and calls you back when they reach a real human. I was skeptical at first, but you can actually see how it works in their demo video: https://youtu.be/_kiP6q8DX5c When I finally spoke to the IRS agent, they explained exactly how to report RSU income correctly in my situation and helped me understand which forms to use. Saved me from potentially making an expensive mistake.

I can't believe I'm saying this, but I tried Claimyr after posting my skeptical comment. I've been trying to reach the IRS for 3 weeks about my RSU reporting issue and was going nowhere. Within 45 minutes of using the service, I was on the phone with an actual IRS tax specialist who dealt specifically with investment income. They walked me through exactly how to handle the RSU adjustment on Form 8949 and explained why my 1099-B showed a different amount than my W2 (turns out some shares were withheld for taxes). The agent even explained that what looked like "missing money" was actually a capital loss I could claim. Just having a real person explain it made everything click into place. Can't believe I wasted weeks trying to figure this out on my own.

I think there's also a simpler explanation for the discrepancy that no one has mentioned. Sometimes companies withhold a portion of your RSUs to cover the taxes due at vesting. So if your RSUs were worth $16,000 when they vested, but the company withheld say 40% for taxes (about $6,400), you would only receive shares worth about $9,600 - which is close to the $9,000 sale amount you mentioned. Check your pay stub or RSU statement from around the vesting date. You'll likely see that some shares were automatically withheld for tax purposes. This is a common practice called "sell-to-cover" where they sell just enough shares to cover your tax obligation.

Has anyone used TurboTax to report RSUs? I'm having this same issue and wondering if there's a specific way to enter this in TurboTax to make sure it's handled correctly. Every time I try, it seems like I'm getting double-taxed on the RSU income.

This is a really common RSU reporting confusion! Let me break this down step by step: The $16,000 on your W2 represents the fair market value of your RSUs when they vested - this is already included in your taxable income (Box 1 of your W2). You've already paid taxes on this amount. The $9,000 on your 1099-B is what you actually received when you sold the shares. The "missing" $7,000 is most likely due to: 1. Tax withholding - your company probably sold some shares automatically to cover your tax obligation 2. Possible trading fees or timing differences For your tax return, you need to: 1. Report the stock sale on Schedule D/Form 8949 using the $9,000 proceeds 2. Your cost basis should be the portion of the $16,000 that corresponds to the shares you actually received and sold 3. If you sold immediately after vesting with minimal gain/loss, your cost basis should be very close to the $9,000 proceeds The key is making sure you don't get double-taxed on the RSU income that's already in your W2. Check your brokerage statements for any "tax withholding" or "shares sold to cover taxes" entries around the vesting date - that will explain the difference.