Many Uber employees miss this step, which leads to incorrect filings.Do you know your Shares Are Sold for Taxes even if you are not selling those shares?

CA Pranay Bafna (Expert RSU and ESPP Taxation) - 8888458882

If you’ve had a Restricted Stock Units (RSUs) vest, you might have noticed that you’re not directly selling the shares—Uber is selling a portion of them to cover taxes. However, this still impacts your tax reporting, and understanding how to report it correctly is crucial.

🔍 Why Does This Matter?

Uber sells some of your vested shares to recover taxes before crediting the remaining shares to your account. The key point here is that even though you’re not selling them yourself, this transaction is still considered a sale for tax purposes.

📌 Example:

Vest Date (Jan 16, 2024): 9 RSUs vest at $63.65 per share → $572.85 reported as income.

Shares Sold for Tax Withholding (Jan 19, 2024) : 3 shares sold at $62.84 per share to cover taxes → You receive 6 shares in your account.

Capital Loss: Since shares were sold at $62.84 instead of $63.65, there is a short-term capital loss of $2.43 on 3 shares sold.

⚠️ Key Takeaway:

Even though Uber sells the shares on your behalf, you still need to report the capital gain or loss in your tax return. Many employees miss this step, leading to incorrect filings.

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