4 ms·

Unfortunately it doesn’t seem like this applies to RSUs.

gen220 4y ago
What resource leads you to believe otherwise? The 83(b) election applies to RSUs [1] It even applies to ISOs (if your company allows you to "exercise early", i.e. pre-vesting). The important thing to note is that the deadline timer for an 83(b) starts ticking at granting, not at vesting, which is a date that most people don't hold in their heads as important. [1]: https://www.investopedia.com/articles/tax/09/restricted-stock-tax.asp#toc-section-83b-election https://www.investopedia.com/articles/tax/09/restricted-stoc...
- redwood 4y ago
  RSU taxes are paid at time of vest: there is no alternative that I'm aware of to that. This comment is wrong The link above confirms this "Taxation of RSUs The taxation of RSUs is a bit simpler than for standard restricted stock plans. Because there is no actual stock issued at grant, no Section 83(b) election is permitted. This means that there is only one date in the life of the plan on which the value of the stock can be declared. The amount reported will equal the fair market value of the stock on the date of vesting, which is also the date of delivery in this case. Therefore, the value of the stock is reported as ordinary income in the year the stock becomes vested."
  - gen220 4y ago
    It appaeared like the investopedia article I linked contains contradictory information. In one passage it says you can elect 83(b) at grant. In the section you quote, it says you can't. As it turns out, the information isn't actually contradictory, but it is unclear. The first passage I linked refers to RS (Restricted Stock) whereas the second refers to RSUs (Restricted Stock *Units*), which are two different things (TIL). Here's an article that explains the difference [1], the TLDR is that RSUs convert from "units" into stock upon vesting, whereas RSs are stocks that already exist at grant time and are merely transferred upon vesting. That difference means that you can claim 83(b) on RSs but not on RSUs. Fascinating. [1]: https://hudsonoakwealth.com/giving-tree/2019/6/21/should-you-make-an-83b-election-with-you-restricted-stock https://hudsonoakwealth.com/giving-tree/2019/6/21/should-you...
- doktorhladnjak 4y ago
  RSU != Restricted Stock even though the names are quite similar

What resource leads you to believe otherwise? The 83(b) election applies to RSUs [1] It even applies to ISOs (if your company allows you to "exercise early", i.e. pre-vesting). The important thing to note is that the deadline timer for an 83(b) starts ticking at granting, not at vesting, which is a date that most people don't hold in their heads as important. [1]: https://www.investopedia.com/articles/tax/09/restricted-stock-tax.asp#toc-section-83b-election https://www.investopedia.com/articles/tax/09/restricted-stoc...

redwood 4y ago
RSU taxes are paid at time of vest: there is no alternative that I'm aware of to that. This comment is wrong The link above confirms this "Taxation of RSUs The taxation of RSUs is a bit simpler than for standard restricted stock plans. Because there is no actual stock issued at grant, no Section 83(b) election is permitted. This means that there is only one date in the life of the plan on which the value of the stock can be declared. The amount reported will equal the fair market value of the stock on the date of vesting, which is also the date of delivery in this case. Therefore, the value of the stock is reported as ordinary income in the year the stock becomes vested."
- gen220 4y ago
  It appaeared like the investopedia article I linked contains contradictory information. In one passage it says you can elect 83(b) at grant. In the section you quote, it says you can't. As it turns out, the information isn't actually contradictory, but it is unclear. The first passage I linked refers to RS (Restricted Stock) whereas the second refers to RSUs (Restricted Stock *Units*), which are two different things (TIL). Here's an article that explains the difference [1], the TLDR is that RSUs convert from "units" into stock upon vesting, whereas RSs are stocks that already exist at grant time and are merely transferred upon vesting. That difference means that you can claim 83(b) on RSs but not on RSUs. Fascinating. [1]: https://hudsonoakwealth.com/giving-tree/2019/6/21/should-you-make-an-83b-election-with-you-restricted-stock https://hudsonoakwealth.com/giving-tree/2019/6/21/should-you...
doktorhladnjak 4y ago
RSU != Restricted Stock even though the names are quite similar