A few years back we were given some shares of Wells Fargo stock in an account with shareowner online. I’m thinking about cashing it in this week. Will I get a 1099 for it and will it be for the full amount? I’m pretty sure I will but just wanted to confirm with others that have cashed in.
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@1rzt+1sv4lakW, cap gain tax is based on the difference between your purchase price and your sale price. Income tax is based on your dividend income. Two different types of taxes.
They do NOT withhold shares for cap gains. Sold some shares this year. Any withholding of shares was when grant happened for income taxes. Those came out in 2018 I believe (before my time) so assume price was 40 per share. You were already charged income tax on that so look back to that year to see how. Now you will pay cap gains as price is 60 so gain is 20 and it is typically a lower rate than income.
Every time you sell your investments, there will be a cap gain tax (difference between the original cost basis and the market value at the sale). A short term cap gain tax is much higher than a long term cap gain tax.
I sold them about 10 days ago. Overall fees were about $40. Worth it. Don’t overthink it.
The normal income tax was withheld from the total # of units when the shares vested years ago unless you had set up special instructions not to do automatic withholding for taxes. You will receive a 1099 with your long term gain or your loss amount. Also you should have been receiving a 1099 for dividends each year.
Are you really asking for tax advice on an anonymous forum?
As @pur+1sv4lakW states you can transfer to a Wells brokerage account however please be warned that it may not transfer what your cost basis was when you bought/recieved. I received a letter from the IRS as my Wells brokerage account showed a $0.00 cost basis and had no idea on the date of purchase. Therefore the IRS was looking to charge me income tax rate on the full sale price. I'd have much rather paid the $40 than deal with all the headaches to prove cost basis and length of ownership.
OP, I don’t know but like @pur said, they taxed those shares the minute they hit the account. I remember being annoyed by this because my thoughts were they should be taxed when/if I cash them but I can also understand that from WF’s perspective they had tax implications that year as a company. I doubt they’d hold back additional shares for taxes. The charge would be a fee, most likely.
Those shares have likely already vested so they have already help back the shares for taxes. When you sell you will get a 1099 showing the gain from the day they vested. They will also charge you to sell them. You could open a Wells Trade account and have the shares transferred there and sell with $0 fees. May take a couple days but will save you $40 or so. Equiniti charges a high price to sell.
They withhold 20-25 shares for taxes and allow you to sell the remainder. All proceeds from the remainder minus trading fees will be deposited in your checking acct.
You will get a 1099 at the end of the year