NUA
I have about 500,000 of NUA (box on 1099R), can I sell the related shares periodically over the next 5 years, keeping track of my NUA per share in order to properly report on the 8949. Also the 1099B from the broker did not properly classify the NUA for the shares sold this year, showed it all as short term cap gain, how do I fix this? On 1040, or get corrected 1099B?
Permalink Submitted by Alan - IRA critic on Mon, 2021-02-22 15:02
You should have advised the broker what your cost basis was per share at the time of distribution from the plan, but should do so now. But they are not likely to revise the 1099B. Hopefully, you are not reinvesting dividends since that further complicates record keeping and reporting and works against diversification. You can sell the shares whenever you wish, and should place diversification needs ahead of tax benefits. Additional gains on these shares after distribution are treated as short term gains for the first year after distribution from the plan, then long term after that. Any losses simply reduce your reportable NUA LT gain per share. You can correct the 1099B cost basis using Form 8949.
Permalink Submitted by John Vertal on Mon, 2021-02-22 20:56
Thanks for your help!