1. What Is Adjusted Cost Basis For RSU?

The adjusted cost basis for Restricted Stock Units (RSUs) represents the fair market value of the shares at the time of vesting. This value is used for tax purposes when calculating capital gains or losses upon sale of the shares.

2. How Does The Calculator Work?

The calculator uses the simple formula:

Where:

• \( Fair\ Market\ Value\ at\ Vesting \) — The market price per share when your RSUs vested

Explanation: The adjusted basis is equal to the fair market value of the shares on the vesting date, which becomes your cost basis for future tax calculations.

3. Importance Of Adjusted Basis Calculation

Details: Accurate adjusted basis calculation is crucial for determining capital gains tax liability when you sell your RSU shares and for proper tax reporting.

4. Using The Calculator

Tips: Enter the fair market value per share at the time of vesting in dollars. This value should be positive and typically comes from your vesting statement or company records.

5. Frequently Asked Questions (FAQ)

Q1: Why is the adjusted basis important for RSUs?
A: The adjusted basis determines your capital gains tax when you sell the shares. It establishes your purchase price for tax purposes.

Q2: How do I find the fair market value at vesting?
A: Check your vesting statement, brokerage account records, or company stock plan administrator for the exact price on your vesting date.

Q3: Are taxes withheld at vesting?
A: Yes, typically a portion of shares are sold to cover income tax withholding at the time of vesting.

Q4: What if I sell immediately after vesting?
A: If you sell immediately, there should be minimal capital gains since the sale price will be very close to your adjusted basis.

Q5: How does this differ from stock options?
A: RSUs have their basis set at vesting value, while stock options have an exercise price that may be different from the market value.