Tax Center

Effective from the start of 2018, the Tax Cuts & Jobs Act includes provisions that either directly or indirectly affect stock compensation, whether in financial planning or in stock plan administration (though the core tax treatments have not changed). This article details six provisions that have an impact on the taxation of stock compensation or holdings of company shares.

Podcast included! While in 2018 Tax Cuts & Jobs Act superseded many prior tax provisions, other tax provisions introduced in previous legislation (such as the Affordable Care Act, i.e. Obamacare) remain in place. Income thresholds for the tax brackets trigger higher tax rates, so it is wise to monitor the tax impact of income-generating events stemming from stock compensation. This article suggests strategies for minimizing their impact.

Stock options and RSUs are popular at startups and late-stage pre-IPO companies. However, shares in privately held companies typically lack liquidity and thus cannot be sold, creating difficulty when taxes are owed on the income recognized. To address this problem, the Tax Cuts & Jobs Act introduced an income-deferral opportunity for certain types of stock compensation at privately held companies in Section 83(i) of the tax code.

The table in this FAQ shows the types of taxes, when they are triggered, and the tax withholding (if any) for various forms of equity compensation granted in the United States. For details, examples, and illustrations...

Generally, each state you live in determines what income is taxable and when. For administrative ease, many companies...

Capital gain is income that arises from the sale of a capital asset. Gain from the sale of securities held for investment, such as shares acquired from stock compensation...