Restricted Stock & RSUs Quiz

Test Your Knowledge: Restricted Stock & RSUs Quiz For more information, see our Restricted Stock section. The correct answers to each question are indicated below by red arrows
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1.	What is restricted stock?
		A type of stock option
		The collective term for a grant of stock units
		A grant of company stock you must register with the SEC
		A grant of company stock that you cannot sell until vesting
	To learn more: Articles: Restricted Stock Fundamentals: What You Need To Know (Part 1) FAQs: What is the process of granting equity awards? and What is restricted stock? Does it differ from restricted securities?


2.	How long after grant does restricted stock usually expire?
		It never expires, unless your employment ends before vesting
		10 years, unless your employment ends before vesting
		10 years, regardless of whether your employment ends before vesting
		When you retire
	To learn more: Articles: Restricted Stock Fundamentals: What You Need To Know (Part 1) FAQs: Does a grant of restricted stock or performance shares have an expiration date, as stock options do? and Once my restricted stock vests, is it mine forever?


3.	What happens to vested restricted stock?
		50% of the stock is rolled into another company benefit, usually a 401(k)
		The stock becomes yours to hold or sell after a lockup period of 180 days
		The stock becomes yours to hold, sell, or gift, like any other stock purchased on the open market
		The company requires you to hold it for a set period, usually three years, before selling
	To learn more: Articles: Restricted Stock Fundamentals: What You Need To Know (Part 1) FAQs: My stock will be "released" or "delivered" at vesting. What does that mean? and Once my restricted stock vests, is it mine forever?


4.	When is restricted stock normally taxed?
		At grant
		At vesting
		At grant and vesting
		Never
	To learn more: Articles: Restricted Stock Taxation: What You Need To Know (Part 2) FAQs: When and how is a grant of restricted stock or RSUs taxed? and UPDATED! How and when are taxes withheld from my restricted stock?


5.	Which is one difference between restricted stock and restricted stock units (RSUs)?
		An RSU is one share of restricted stock
		You don't get shareholder voting rights with RSUs
		With RSUs, vesting must be time-based
		With RSUs, you pay tax at retirement
	To learn more: Articles: Restricted Stock Units Made Simple (Part 1): Understanding The Core Concepts and Restricted Stock Units Made Simple (Part 2): Taxation FAQs: What is the difference between restricted stock and restricted stock units (RSUs)?, Do I get dividends with restricted stock units (RSUs)? How are they taxed?, and Why would my company grant me restricted stock units (RSUs) instead of restricted stock?


6.	What do you accomplish with a Section 83(b) election on restricted stock?
		Trick question: the 83(b) election is not available for restricted stock
		You choose to be taxed on the value at vesting instead of at grant
		You choose to be taxed on the value at grant instead of at vesting
		You choose to be taxed at grant instead of sale
	To learn more: Articles: Decisions At Grant With Restricted Stock (Part 1): Tax Fundamentals FAQs: Can I make a Section 83(b) election for a grant of restricted stock units (RSUs)? and UPDATED! How do I make a timely and complete Section 83(b) election?


7.	What do you accomplish with a Section 83(b) election on restricted stock units?
		The 83(b) election is not available for RSUs
		You choose to be taxed at grant instead of vesting
		You choose to be taxed at vesting instead of grant
		You lock up the shares for the long-term capital gains holding period
	To learn more: Articles: Decisions At Grant With Restricted Stock (Part 2): The 83(b) Election Risks FAQs: What is the difference between restricted stock and restricted stock units (RSUs)? and Can I make a Section 83(b) election for a grant of restricted stock units (RSUs)?


8.	Which of the following would probably not accelerate the vesting of restricted stock?
		A stock split
		A merger
		An initial public offering
		Your retirement
	To learn more: FAQs: What is an example of a performance goal that triggers or accelerates vesting?, Are there different types of time-based vesting schedules? Which are most common?, What is a vesting schedule?, and What service counts toward vesting?


9.	What types of tax withholding apply to restricted stock?
		Federal, Social Security, and Medicare
		Federal, state, and/or local (if any)
		Social Security and Medicare
		All of the above
	To learn more: Articles: Decisions At Grant With Restricted Stock (Part 1): Tax Fundamentals, Restricted Stock Taxation: What You Need To Know (Part 2), and Restricted Stock Units Made Simple (Part 2): Taxation FAQs: When and how is a grant of restricted stock or RSUs taxed? and UPDATED! How and when are taxes withheld from my restricted stock?


10.	When does the capital gains holding period start if you have not made the Section 83(b) election?
		At grant
		On the vesting date
		On the day after the vesting date
		When the shares show up in my account
	To learn more: Articles: Decisions At Grant With Restricted Stock (Part 3): Analyze Your Alternatives and Restricted Stock Taxation: What You Need To Know (Part 2) FAQs: When does my capital gains holding period begin for grants of restricted stock and restricted stock units (RSUs)?


11.	How does a performance share grant differ from a standard restricted stock/RSU grant?
		Performance shares are a type of stock option granted to senior executives and directors
		Performance shares carry greater tax benefits than restricted stock does
		Performance share vesting or payout is based on the achievement of set goals rather than length of employment
		Performance shares give you a direct share in your company's profits
	To learn more: Articles: Performance Shares: The Basics (Part 1) and Performance Shares: Grant Structure, Expiration, And Job Events (Part 2) FAQs: What is the difference between restricted stock and performance shares or units?


12.	Which of the following is an example of a metric that US companies often apply to performance share grants?
		Increased earnings per share
		Increased total shareholder return relative to that of competitors
		Revenue growth
		All of the above
	To learn more: FAQs: What types of company goals are most commonly set for performance shares and units? What do surveys show about the performance metrics that companies use?


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