Restricted Stock: Taxes
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Articles (Jump to FAQs)
Tom Davison
Thanks to the IRS, with restricted stock you have to make decisions immediately at grant. Learn the rules that accompany this increasingly popular type of equity compensation.
Bruce Brumberg and Kate Victory
Along with stock options, your company has awarded you restricted stock. Restricted stock grants carry their own requirements and tax rules, which can significantly differ from those of stock options.
Tom Davison
Vesting is a crucial moment for making decisions about your restricted stock. This article series examines your alternatives. Part 1 discusses withholding.
Sandra Block
USA Today, 7/14/03
Know how restricted stock and options differ, including in tax rules.
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FAQs (Jump to articles)
Generally, yes, with two exceptions. First, with RSUs you cannot...
The tax treatment is different than that of stock options. You pay tax at the time the restrictions on the stock lapse. The tax is based on the value of the shares at...
Restricted stock results in ordinary income to you. This occurs either at the time...
Restricted stock units result in ordinary income to you. This occurs when...
In some ways they are similar. The tax treatment of restricted stock is the same for everyone. The reporting and withholding income is different. If you are an employee...
This tax term applies when rights to compensation are conditioned upon future performance of services or the occurrence of...
Not as you can with stock options. With stock options, tax consequences occur when...
Restricted stock withholding is similar to withholding for most other forms of supplemental compensation. You can have different choices for paying taxes, or your company may automatically...
Many states, counties, and cities impose income tax on their residents. Those that do have income tax almost always...
This depends on how your stock plan defines fair market value (FMV). Some companies may use the closing price on the vesting day, which...
Dividends that are earned on restricted stock are considered compensation income, which is reported on your W-2...
For restricted stock, it begins on the day after vesting, unless...
The holding period for capital gains and the date of your sale, not the grant or vesting date of the restricted stock, are what matter. The tax on the capital gains is...
An option-for-option exchange is not taxable. But when you exchange underwater options for restricted stock...
While there are some general trends, the treatment of stock options and other stock grants in divorce is far from similar in all states. In general, the outcome depends on four factors...
The basic principles that apply to options transferred in a divorce settlement also should apply to the transfer of restricted stock...
Typically, all or a
pro rata portion of any restricted stock vests at death. The value of restricted stock that vests and is payable at your death will...
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