Equity Compensation Tax Planning
RSUs, ISOs, NSOs, ESPP and AMT — planned before the vest or exercise, not after. We work with employees and founders in California whose pay arrives partly as stock, where the timing of a vest, an exercise, or a sale changes what is owed.
For employees and founders holding equity. Tell us where to reach you and we will contact you to discuss your situation.
Request Received
Alex will contact you to schedule your consultation. For anything urgent, call (951) 216-3121.
Equity is taxed on events, not on intentions. A vest creates ordinary income whether or not you sell. An incentive stock option exercise can create alternative minimum tax even when nothing has been sold and no cash has arrived. An employee stock purchase plan sale is taxed differently depending on how long the shares were held. California adds its own layer, because the state taxes this income as ordinary income and applies its own alternative minimum tax separately from the federal one.
What We Plan For
RSU Vesting
Restricted stock units are ordinary income at vest, valued at the share price on the vest date, whether or not you sell. We plan withholding, the sell-to-cover decision, and what the vest does to the rest of your return.
ISO Exercise and AMT
Exercising an incentive stock option without selling can create alternative minimum tax on the spread. We model the AMT exposure before the exercise so the decision is made with the number in front of you.
NSO Exercise
Non-qualified stock options create ordinary income on the spread at exercise, with withholding through payroll. We plan the timing against the rest of your income for the year.
ESPP Dispositions
Whether an employee stock purchase plan sale is a qualifying or disqualifying disposition changes how much is ordinary income and how much is capital gain. We plan the holding period and the sale.
Section 83(b) Elections
Where restricted stock is granted subject to vesting, an election under Section 83(b) can change what is taxed and when. The window to make it is short, so it has to be considered at grant.
California Treatment
California taxes this income as ordinary income and applies its own alternative minimum tax. If you moved into or out of the state while equity was vesting, the allocation between states has to be worked out.
When to Call
How an Engagement Works
Scoping Call
We start with a conversation about your employer, the kind of equity you hold, what is vesting or exercisable, and what you are deciding. No documents are needed for this.
The Plan
We model the events on the table and the tax they create, federal and California, so you can see what each choice costs before you make it.
Execution Across the Year
Equity decisions arrive on their own schedule. We stay available through the year so the vests, exercises, and sales are handled against the plan rather than in isolation.
Equity Compensation FAQ
Plan the Equity Before the Event
Start with a conversation about what is vesting, what is exercisable, and what you are deciding.