Claudio: so. If someone already pays income tax at vest, when keeping those stocks for a X period (taking the risk) you get taxed again when selling on a gain, right? Is the tax percentage the same, like paying twice?
Only the gain portion will get taxed when you sell, so no money is being taxed twice. It gets capital gains treatment, meaning it will be short-term if held 1 year or less (tax rate the same as income) or long-term if held > 1 year (0/15/20% tax rate) An example: -1,000 RSUs vest at $10/share = $10K of income -After taxes, we'll say that 700 shares remain = $7,000. -You hold onto the 700 RSUs > 1 year and sell at $15/share = $10,500 -You'd pay LTCG on $3,500. At 15%, that's $525. -The original $7,000 isn't taxed again.
Thanks for the discussion and helpful overview. Your channel is really helping me sort out my thinking when it comes to stock options. Recently handled some RSUs vesting and exercised+sold some NQOs A LOT more comfortably after your videos. Next step is to figure out selling some of my private company ISOs during an offer period (before IPO). Tax advise in this video is a good start with that. @.@ AMT. But seriously, I've been combining RUclips for help with this and I think your channel / explanations might be the best.
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Thank you
Claudio: so. If someone already pays income tax at vest, when keeping those stocks for a X period (taking the risk) you get taxed again when selling on a gain, right? Is the tax percentage the same, like paying twice?
Only the gain portion will get taxed when you sell, so no money is being taxed twice. It gets capital gains treatment, meaning it will be short-term if held 1 year or less (tax rate the same as income) or long-term if held > 1 year (0/15/20% tax rate)
An example:
-1,000 RSUs vest at $10/share = $10K of income
-After taxes, we'll say that 700 shares remain = $7,000.
-You hold onto the 700 RSUs > 1 year and sell at $15/share = $10,500
-You'd pay LTCG on $3,500. At 15%, that's $525.
-The original $7,000 isn't taxed again.
Thanks for the discussion and helpful overview. Your channel is really helping me sort out my thinking when it comes to stock options. Recently handled some RSUs vesting and exercised+sold some NQOs A LOT more comfortably after your videos. Next step is to figure out selling some of my private company ISOs during an offer period (before IPO). Tax advise in this video is a good start with that. @.@ AMT. But seriously, I've been combining RUclips for help with this and I think your channel / explanations might be the best.
Great job guys! I am an XYPN member as well!
I appreciate it, Silvia. Great stuff on your channel as well!