Based on your financial expertise, provide your response or viewpoint on the given financial question or topic. The response format is open.

Why is RSU tax basis based on remaining shares after shares are witheld?
You only got 75 shares, so your basis is the fair market value of the stock as of the grant date times the number of shares you got: $20*75.  Functionally, it's the same thing as if your employer did this: As such, the basis in that stock is $1,500 ($20*75). The other 25 shares aren't yours and weren't ever yours, so they aren't part of your basis (for net issuance; if they were sell to cover, then the end result would be pretty similar, but there'd be another transaction involved, but we won't go there).  To put it another way, suppose your employer paid you a $2000 bonus, leaving you with a $1500 check after tax withholding. Being a prudent person and not wishing to blow your bonus on luxury goods, you invest that $1500 in a well-researched investment. You wouldn't doubt that your cost basis in that investment at $1500.