Employee Stock Options - RSU

[KarenMM]

Client has 2 types of options that he exercised in 2019 - the Non-qualified options with a code "V" on his W-2 makes sense to me. However, he also sold some shares listed as RSU grant type on the supplemental stock plan info from his employer/e-trade. Those shares had a "W-2 income" column of $9,679.68 on the "statement of taxable income " from his employer, with the W-2 itself, showing box 14 of RStkTxbl of $9,538.08, and DivdEq of $141.60. That statement of taxable income also shows zeros in the adjusted sales price column, the same column where the NQO's from above have the code V amount..... A third piece of paper, the "stock plan supplement" from E-trade, showed total proceeds of $6440.11 and an adjusted cost basis of $6,461.28.
I am having a hard time figuring out how to handle these. Pages 6-18 and 6-19 barely mention RSUs, and 22-4 only talks about them in the context of employer benefits info.
Are there any ESOP experts out there to help me?

[KarenMM]

I think I found my answers - I found an investopedia article that talks about RSUs - "The amount reported will equal the fair market value of the stock on the date of vesting, which is also the date of delivery.... therefore, the value of the stock is reported as ordinary income in the year the stock becomes vested." This tells me that schedule D shows 6440.11 sale, and 6461.28 as cost basis, with the difference being a capital loss associated with brokers fees, and the $9,679.68 is already taxed as ordinary income on the W-2.
Does anyone disagree with this treatment?

[Rapid Robert]

RSUs are not options, so there is no exercise. Often the company will immediately sell some of the RSUs to cover the tax withholding reported via payroll, although lately I seen where they simply hold some of the grant back for the same purpose. Bottom line is the same for the employee, but without an actual sale, I guess the employer doesn't need to sell stock into the open market if they don't want to.

Since the RSUs were worth $9.5K of compensation but only $6.4K was reported as sale proceeds, perhaps this is what happened. It is also possible the employee will hold some or all of the RSUs for a while before selling them. You should probably see if you can reconcile the number of shares, not just the dollars.