I notice that E-Trade reports on the Form 1099-B that the cost basis for vested RSUs is 0 USD.

  1. Shouldn't the cost basis that report in my tax form be the value of the shares at the time of vesting?
  2. If so, why isn't the value of the shares at the time of vesting reported as of the the cost basis on Form 1099-B?

Snapshot from the Form 1099-B form, Cost or Other Basis column for an RSU row:

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  • 2
    E-Trade isn't required by law to track the basis for means of acquisition other than purchase, so they don't. It is annoying. Mar 10 '19 at 23:14
  • There's no footnote on this item saying that basis was not reported to the IRS? It would be wrong for them to report a basis of $0.00, but missing basis information is different.
    – Ben Voigt
    Mar 11 '19 at 0:20
  • @BenVoigt The Form 1099-B form I read contains the notice: "The information provided below is in accordance with Federal tax regulations and the IRS instructions that govern our reporting requirements. You should review this information carefully when completing your Form 8949 and Schedule D. There may be instances where our reporting requirements will not be consistent with your particular tax accounting position or elections. For these reasons, the IRS requires us to provide you with this reminder: Taxpayers are ultimately responsible for the accuracy of their tax returns." Mar 11 '19 at 0:24
  • @BenVoigt so they absolve themselves from any responsibility. Mar 11 '19 at 0:24

This is typical for RSU vesting, because you didn't buy the stock through the broker. Fidelity and Vanguard do this too. Just fill out your Form 8949 or Schedule D and adjust the basis to the actual basis. If you're a sell-on-vest person, don't forget that the brokerage probably charged you a commission, making it likely you've got a tiny loss for tax purposes.

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