Sorry if this has been covered, but still confused after reading through the posts. On my 1099 it shows, for example, a sale of 21 shares with net proceed of $1434.84. If BC paid $142.50 per share, then that should be 2992.50, right. What am I missing?
When I add in the adjusted cost basis I always show a loss, even though cost basis per share was only $64.77. Every single transaction shows a loss. Again, what am I missing?
Any help is appreciated!
"To sell shares before the acquisition is short sighted. "
Not true, it's a decision to cash out and move on before Broadcom changed the VMware compensation terms and conditions. Remember, 'RSU futures' only matter if you're able to cash them in. HT is focused on external shareholders, not employees. Wait and see.
“Why did t people sell before close?”
Because we like money and due to the bcom stock price increase we got a crud ton more after the conversion.
That 50k grant a lot of got last June more than doubled in value. To sell shares before the acquisition is short sighted. Keeping them was worth the one time pain of this tax season.
"Because we did not want the entire tax hit in 2023"
Understood. In some cases (like mine) it was worth paying the capital gains tax and avoiding the hassle of dealing with a fraction of the AVGO shares. Now no regrets.
"Why didn't most employees sell the VMware RSUs before the close date? It's puzzling."
Because we did not want the entire tax hit in 2023, at least in my case. All cash would have pushed me to higher tax bracket.
Why didn't most employees sell the VMware RSUs before the close date? It's puzzling.
People don't know how to report this share conversion transaction correctly. Some paid accountants won't report it correctly to the IRS for 2023. So, expect IRS correction letters.
Thanks @fma+1rRT9hmG, these are shares Broadcom purchased from me on acquisition close date. They gave half in cash and rolled the other half into AVGO shares (each VMW share approx = 1/4 share of AVGO).
In the example I gave, those RSU shares vested 11/1/2016. There are 11 transactions similar to this on my 1099, one for each RSU vesting date during my illustrious career at VMW. :-)
And I think that answers my own question. The $1434.84 is the cash portion I received for those 21 shares. If I divide cash received by the true purchase price (21 shares x 142.50 = $2294.50), that come to .6253. So, I should apply that same percentage to my total cost basis (21 x 64.77 = 1,360.17). So, 1,360.17 x .6253 = $850.51. Therefore,
I figured since all of us are in the same boat where transaction history was not retained when Broadcom moved our VMW Etrade accounts to an AVGO Etrade account, that others would have the same questions and may have already figured it out. :-)
I’d take this question to a CPA, not the internet.
There’s too many variables and questions someone would need to know to accurately answer your specific situation. Were these shares part of the acquisition payout, or did you select to sell them? Were these shares sold off to cover taxes when other shares vested? What date did this transaction happen? When were the shares in question originally purchased / vested? Whats the breakdown on the supplemental portion of the 1099, and / or did you find the supplemental document online that covers this transaction for additional detail? Etc etc
It’s not uncommon to show a loss if you sell shares as soon as they vest, since cost basis is factored based on market value the date of vesting. So if the sale happens the same day as vesting, once they take out fees, you can easily show a capital loss, not gain.