Tax Loss Harvesting with Private RSUs in the US
Tax Loss Harvesting with Private RSUs in the US
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VLD · External communityPost link
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Author: VLD
Original post: https://money.stackexchange.com/questions/164845
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While working for a private company, I received part of my compensation in RSUs. The RSUs vested in 2023 and I had to pay income tax in 2023 based on a 'market value' provided by the company.
The stocks were never publicly traded and I do not know how the 'market value' was established.
This year, 2024, the company itself made a tender offer and I chose to sell the stocks. However, the 'market value', and thus the price offered for the stocks, was now significantly lower than when the RSUs vested.
Can this loss be used to offset capital gains tax incurred from selling other normal, publicly traded stocks, before the end of this year?
Specifically, does it matter that the loss came from those private RSUs?
Would the wash sale rules apply if I received more similar RSU compensation in the 30 days before and after the sale? To emphasize, I did not purchase additional stocks, but I received them as part of my compensation, and I still own them.
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littleadv · External communityPost link
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Author: littleadv
Original post: https://money.stackexchange.com/a/164846
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Can this loss be offset by selling other normal, publicly traded stocks, at a gain, before the end of this year?
Yes, you can sum up all the capital gains and losses at the end of the year, and carry over losses in excess of the gains (and the $3K you can deduct from other income).
Specifically, does it matter that the loss came from those private RSUs?
No.
Would the wash sale rules apply if I received more similar RSU compensation in the 30 days before and after the sale?
Yes.
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Barmar · External communityPost link
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Author: Barmar
Original post: https://money.stackexchange.com/a/164847
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For purposes of taxation, RSUs are treated as if you received the value of the stock as ordinary wages on the day that the RSU vested, and immediately purchased the shares at that price. The value will be included in your W-2 wages for that year (so you'll pay ordinary income tax on it that year), and then becomes the cost basis of the shares.
Then when you sell the shares (including agreeing to the tender offer from the company), you fill our Schedule D based on the above treatment. And the wash sale rule applies similarly.
The Tax Advisor
has an article on the tax treatment of various forms of stock-based compensation, it explains this.
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Quoted from Forex.com.bd-Editorial External question — Personal Finance Stack Exchange Author: VLD Source score (net votes, not local likes): 0 Original post: https://money.stackexchange.com/questions/164845 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. While working for a private company, I received part of my compensation in RSUs. The RSUs vested in 2023 and I had to pay income tax in 2023 based on a 'market value' provided by the company. The stocks were never publicly traded and I do not know how the 'market value' was established. This year, 2024, the company itself made a tender offer and I chose to sell the stocks. However, the 'market value', and thus the price offered for the stocks, was now significantly lower than when the RSUs vested. Can this loss be used to offset capital gains tax incurred from selling other normal, publicly traded stocks, before the end of this year? Specifically, does it matter that the loss came from those private RSUs? Would the wash sale rules apply if I received more similar RSU compensation in the 30 days before and after the sale? To emphasize, I did not purchase additional stocks, but I received them as part of my compensation, and I still own them.
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