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    #1

    Restricted Stock Units

    Client gave me a 1099-B. I asked client for purchase date and purchase price of sold stocks. What she faxed to me was a "restricted unit lapse" form. Usually with stock options, W-2 shows a code "V", but client's W-2 has no V code. Is the restricted stock unit handled differently by employer - just added in as ordinary compensation? Form shows the following info: 1099B shows gross proceeds of $738.47 which does not match up to anything on form. Any help would be much appreciated.

    Lapse Date: 10/15/07
    Grant Date: 12/9/05
    FMV Price: $76.54 per unit
    Grant Price: 0
    Units Granted: 91.00
    Units Lapsed: 18.6831
    FMV: 1,430

    Then it shows Taxable Compensation: $1,430 and a breakdown of payroll taxes due and paid of $608.47.

    Units Lapsed: 18.6831
    United used to pay taxes: 7.9497
    Net Units: 10.7334
    Tags: None
    #2
    Peggysioux, I'm gonna try and take a shot at this as I am dealing with a colossal one right now that has some ISO's as well as the lapsed shares.

    When the restrictions on the 18.6831 shares lapsed, the FMV of $76.54 became taxable compensation- the $1,430. (TTB 6-18) You can figure it is in the W-2 since taxes were withheld. To pay the taxes, shares were sold. The 1099-B gross proceeds of $738.47 are exactly $130 more than what was needed to pay the taxes- could it be the sales commission?

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      #3
      Restricted Unit Lapse

      No where does it show sales commission. There was no exercise fee charged, so unsure. Would the basis be the $608.47 (the FMV of the units used to pay taxes??) Also, unsure because form shows taxable compensation of $1,430 which is the FMV of the units that lapsed. I would have thought that that would be the gross proceeds. I have never dealt with this type of stock option so very confused.

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        #4
        The $1,430 compensation isn't the gross proceeds. The $1,430 is his compensation due to the restrictions lapsing. He has only had to sell enough of the lapsed shares (7.9497) to cover the taxes w/h- the $608.47. So that plus $130.00 more (whatever that is) are the gross proceeds.

        So, yes, basis would be at least the $608.47.

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