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How to report RSUs on your tax return (W-2 + 1099-B)

Reporting RSUs means connecting W-2 wage income to brokerage 1099-B sales — this guide maps the flow.

Rates and rules change. Content is reviewed for tax year 2026. Check the last-reviewed date and methodology on each page, then confirm against IRS or state guidance before you file.

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You are filing and need to know which tax form covers RSU income — whether vest wages belong on the W-2 alone, why you also got a 1099-B, and where Form 8949 fits when basis is wrong.

In plain terms

Report income through your wages — you generally do not enter it again as separate income. When you sell shares, report each sale on Form 8949 and Schedule D using proceeds from and basis equal to (adjust if the broker shows $0).

Gather before you start

  • for the year.
  • All forms for sales.
  • confirmations with per share.
  • Broker supplemental stock plan report if provided.

How the tax works

The IRS treats and sales as two different events on two different forms. is wage income your employer reports on Box 1; you enter the on Form 1040 and do not file a separate income line for the itself.

When you sell shares, your broker reports the disposition on with proceeds in Box 1d and often $0 or blank because the broker did not run payroll on the . Form 8949 is where you list each sale with correct basis — generally per share times shares sold — before Schedule D summarizes or loss.

Tax software imports literally unless you override basis. An sale with $0 imported basis can make software tax the full proceeds as gain even though Box 1 already included the wages. The fix is a basis adjustment on Form 8949, commonly Code B when basis was not reported to the IRS, not deleting the sale.

Holding period on Form 8949 starts at for typical employee lots, not . Short-term vs long-term follows -to-sale timing. Multiple vests mean multiple basis lots — each sale row should tie to a specific confirmation .

State returns mirror the federal split: wages on state wage lines from the , from Schedule D. Multi-state boxes need the same story on both federal and state worksheets.

What to check on your end

  • Box 1 includes known totals.
  • Each sale matched to a lot.
  • Basis adjustment entered where broker reported $0.
  • Short-term vs long-term from to sale date.
  • State return wage and lines match federal story.

Entering vest income twice

The already includes the . Importing with $0 basis and not adjusting makes software tax the full sale as gain — that is double-counting economics even if the forms look inconsistent.

What to pull from your files

  • (wages and ).
  • (proceeds and reported basis).
  • Form 8949 / Schedule D draft from software.
  • confirmation for each lot sold.
  • Supplemental lot detail from broker.

Example scenario (hypothetical)

Illustration only, not your tax situation.

Example: wages of $12,000 on . Later sale for $12,500 with $0 basis on . On Form 8949, report $12,500 proceeds and $12,000 basis (adjustment code explaining wage income), leaving $500 .

Questions people ask

Which tax form is for RSU vest income?
Your employer reports income on as wages. You enter the on Form 1040; you do not generally file a separate form just for the event.
What if TurboTax shows a huge gain on my RSU sale?
Check imported basis. sales often import as $0. Add basis equal to per share × shares sold, with documentation from your confirmation. See the Form 8949 walkthrough for column and code details.
Do I attach anything to explain basis adjustments?
Form 8949 includes adjustment codes and amounts. Keep confirmations and in your records; you typically do not mail them unless the IRS asks.
Why do I need 1099-B if RSUs were already on my W-2?
The covers the as wages. The covers the brokerage sale. Both are required when you sell; the sale should mostly reflect price change after if basis is correct.
Many lots sold on one 1099-B line — one Form 8949 row?
Ideally one row per lot with matching . If the broker aggregated, use supplemental lot detail or split proceeds by share count from each confirmation before Schedule D.

When a CPA is worth it

  • Many lots sold on one line.
  • Corrected or 1099 after filing.
  • Multi-state wages from vests.
  • Prior-year return used $0 basis and you need to amend.

Sources and notes

Primary tax claims on this page are supported by the official and secondary sources below. Broker and software links describe reporting mechanics — confirm rules against IRS or state guidance.

W-2 vest wages vs 1099-B sale reporting on Form 8949.

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VestingTax.com is not a CPA firm or tax preparer. Grants, employers, and states all differ. Use the cited IRS and state sources above, your own documents, and a qualified tax professional before you make decisions from this guide.

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