3 ms·
It's advisable to hold your RSUs for at least one year for a favourable tax treatment, so the 33% discount he got is still very good; he's likely not going to s
by adtac 7y ago
It's advisable to hold your RSUs for at least one year for a favourable tax treatment, so the 33% discount he got is still very good; he's likely not going to sell his RSUs in six months.
He got the offer and decided on his start date way back in August of last year so any luck he happens by is good luck. He could've chosen to be luckier if the stock price goes down further, but I'd say this is pretty lucky as it is already for something he can't control.
Edit: ignore the tax part, I think I'm wrong there.
- foota 7y agoIsn't the favorable tax treatment only on the appreciation from the vest price?
- adtac 7y agoAh I'm not too sure. That might be the case.
- dmoy 7y agoRSU is taxed at vest, exactly like cash bonus for tax purposes. If you sell it immediately, it's really exactly like cash.
- arcticbull 7y agoAnd you can't offset your capital losses with RSU vesting, really really exactly like cash haha.
- akhosravian 7y agoYes. RSUs for publicly traded companies are for functionally equivalent to a cash for tax purposes. Not selling them immediately is the same as if your employer had given you a cash bonus and you bought shares of the company with the whole thing.
- thedufer 7y agoI'm not sure what tax treatment you're talking about, but I'm guessing you mean converting short-term capital gains into long-term. RSUs are taxed as income based on the price on the vesting date, so if you sell when it vests there's no capital gains and thus no advantage in waiting. That said, I think Microsoft still does a 1-year cliff, so they won't have anything to sell for a year anyway.
- arcticbull 7y agoYou're thinking of ESPP, and that's 12 or 18 months.