When you sell company stock, it’s normal to feel a little uneasy about tax paperwork—especially if the shares came from equity compensation. You’re not alone. The good news is: brokers generally report sales in a consistent way, and a few key details can help you avoid surprises.
The main tax form you’ll receive: a “Consolidated 1099”
Most brokers send a Consolidated Form 1099 (often available online in January/February). Inside that package, the most important section after a stock sale is usually:
- Form 1099-B (Proceeds From Broker and Barter Exchange Transactions)
Depending on what else happened in the account, your consolidated packet may also include:
- 1099-DIV (dividends or capital gain distributions)
- 1099-INT (interest)
What 1099-B tells you
Your 1099-B typically lists, for each sale:
- Date acquired and date sold (used to determine short-term vs. long-term)
- Proceeds (the gross sales amount)
- Cost basis (what the broker believes you paid)
- Gain or loss (based on proceeds minus basis)
- Whether the basis is reported to the IRS (covered vs. noncovered)
- Any wash sale adjustments (more common with frequent trading)
Key facts to know—especially for company stock
Here are the most common “gotchas” we see:
Cost basis may be incomplete for equity compensation. With RSUs, stock options, or ESPPs, part of the value may already have been taxed as compensation and shown on your W-2. The broker’s basis on the 1099-B doesn’t always reflect that.
Covered vs. noncovered matters. For some older shares or certain transfer situations, the broker may label shares as noncovered, meaning basis may not be reported to the IRS. You may need your own records.
Your tax return uses Form 8949 and Schedule D. Your CPA/EA or tax software typically imports the 1099-B details into Form 8949, which then flows to Schedule D.
Supplemental statements can be important. Some brokers include an additional “supplement” to help reconcile equity-compensation basis. It may not be filed with the IRS, but it can be very useful for accurate reporting.
A simple checklist before you file
- Confirm which lots were sold (FIFO vs. specific identification)
- Check whether gains are short-term or long-term
- If shares came from a company plan, compare the 1099-B to your plan statements and W-2
- Keep trade confirmations and equity plan records with your tax file
If you’d like, we can coordinate with your tax professional and help you understand how your specific company stock sale shows up across your documents—so you feel confident you’re reporting it correctly.