In just the last two years since we started reviewing old tax returns for new Financial Zen Members, we have uncovered over $100,000 in tax OVERPAYMENTS.
That isn’t money they owed. That is money they voluntarily (and accidentally) gave to the IRS because of a paperwork error.
If you have RSUs (Restricted Stock Units) at Fidelity or E*Trade, you are at high risk of making this exact same mistake. The standard 1099-B form they send is often “incomplete” and reports your Cost Basis as $0.
If you just hand that paper to your CPA or plug it into TurboTax, the IRS thinks you made 100% profit. You get taxed twice: once on your W-2 (vesting) and again on your tax return (sale).
Here is the 2-minute check that could save you thousands:
The DIY Hack: Check “Schedule D”
Before you hit “Submit” on your tax return this year, do this one thing:
– Open your tax return draft.
– Find Schedule D (Capital Gains & Losses).
– Scan the column for “Cost Basis.”
🛑 The Red Flag: If you see any sales with a $0 Cost Basis, stop immediately. That is a dead giveaway you are about to pay more taxes than you owe.
Where to Find the Real Numbers:
1️⃣ For Fidelity Users: Do not stop at Page 1. You must scroll to the very end of the 1099 PDF.
Fidelity often hides the “Adjusted Cost Basis” in a supplemental section at the back.
The Fix: Use the numbers from the end of the document, not the standard summary at the front.
2️⃣ For E*Trade Users: The standard 1099 is not enough. You need to hunt for a separate document.
Log in and download the “Premium/Supplemental Tax Notification.”
The Fix: You must use this specific document to get the correct adjusted cost basis.
The “Financial Zen” Take:
We love the IRS, but we don’t believe in tipping them.
Take 5 minutes to double-check your Schedule D. If you see a zero, you’re about to be a hero for your own bank account.
P.S. You can amend tax returns for 3 years, so go check your Schedule D for previous years too. (And you only have until April 15, 2026 to amend your 2022 Tax Return, so start there!)