Compensation and withholding
RSUs, PSUs, bonuses, option exercises, deferred compensation, and other payments can create obligations that ordinary payroll withholding does not fully cover.
Executives, founders & concentrated equityExecutives, founders
Executives, founders
& stock compensation
Tax advice for compensation, concentrated stock and a significant equity decision. We work with you and your existing advisors on the acquisition history, timing, payments and filings.
The tax work
Concentrated stock
Sales, charitable transfers, basis, holding periods, prior compensation income, estimated payments, and state exposure may all affect the same year.
Founder liquidity
Exercises, tenders, secondaries, acquisitions, installment terms, records for a qualified small business stock (QSBS) review, charitable transfers, and expected tax payments.
State moves and multistate exposure
Residency, sourcing, vesting periods, travel, property, and transaction timing can affect more than one state return.
What the analysis includes
Current fact summary
The relevant grants, holdings, basis records, compensation, state facts, and proposed transaction terms.
Tax analysis
Projected federal and state tax for the alternatives, with key assumptions and unresolved questions.
Action and filing plan
Payments, documents, deadlines, responsible professionals, and the returns or forms that follow.
Carryforward record
The facts and positions that need to remain available for later years and future transactions.
Illustrative example · Not an actual client matter
A planned stock sale and charitable gift
An illustrative executive matter might include several stock-compensation programs, an eight-figure position, a proposed charitable transfer, a possible sale, and a move between states.
- Reconcile compensation, lot, basis, holding-period, and state information.
- Project tax payments under the proposed sequence.
- Identify which assumptions belong with legal, investment, or securities advisors.
- Carry the approved facts into the return record.
Working with your other advisors
We coordinate the tax analysis with your investment advisor and transaction counsel. That includes the relevant acquisition records, proposed timing, payments and filing requirements.
Entity and trust documents can be prepared by affiliated Hickok Tax Law, PC under a separate legal engagement. Investment decisions and execution remain with you and your investment advisor.
Related reading
Before a concentrated-stock sale or gift
The size of the position is not the only source of complexity. Compensation history, tax basis, holding periods, state facts, charitable plans, cash needs, and the rest of the year may all affect the tax result.
Read the article