Death and... Taxes.

I believe they would be taxed as regular old w2 income of Their value on the day you receive them. If you hold the shares and sell a year later you can pay long term capital gains instead of short, but you are on the hook for their value right now when you get them either way.

Whatever the current valuation, public is easy to get, private a little harder but you should be able to ask, x the number of RSUs you are getting will be taxed as regular income since RSU are free and not like normal options if memory serves. You are taxed at their value on the day you receive them.

so 1000 shares at 1.00 share price = extra 1,000.00 on your W2. I don’t know what bracket you re in so you’ll have to do some math, but low end would be 25% high end closer to 40-50%(state + federal). so to be 100% safe you could sell to cover half and use that for taxes, but usually it’s a bit less than half and for normal people would tend to be around 33%.

edit: if you tell them you want to sell to cover they can help you a bit with the math too

Foler said:

I’m getting my next RSU vest next month. I’ve elected sell to cover. I’m trying to get a rough estimate of how much will actually be sold to cover. Any suggestions how?

Also, I think I missed the deadline with my employer to modify my tax withholding. I’d like to withhold as little as possible without incurring a penalty. I’m OK with a big federal tax bill versus lending the gov money interest free. I’m not OK for being penalized financially for withholding too little.

Any suggestions on how to calculate this? If I calculate it and my math adds up to be projected under withholding can I make a contribution myself pre-tax season to avoid penalty?

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There are estimated tax calculators you can use for this. If the money doesn't clear until Q3/4 you can probably also get away with saying that you have unevenly distributed income and they'll waive the underpayment penalty. I have a consulting business with very lumpy cash flows and I do this literally every year. I don't think I've ever paid a penalty.

As far as the amount to be sold, your company's HR/finance department should be able to tell you.

Nabi said:

Recently found 300k in cash that my father left in the garage. He passed away last year and we went through probate court. All he had left was a 401k and a car. Surprisingly no bank account when he passed. I guess he stashed it there. Anyway I can avoid paying taxes on it?

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Use it over the next few decades for things you can spend cash on? Literally every small purchase - cash.

Yeah, and all banks are tracking deposits because of anti money laundering standards they adhere to. If you try to trickle in deposits below some limit (like under 10k or under 5k) they will pick up on it no matter how clever you’re being.

Dude it’s cash. I’d never say a thing to anyone. Do exactly what you are doing.
Spend or deposit small amounts at irregular intervals over the next 2-5 years.

if you wanted/needed something. Looks for used things from people who want cash. If you just want to save and invest then keep depositing random different amounts at irregular intervals. Stay away from anything pattern oriented.
Though in reality, almost no chance an avg joe would be audited over something like this. But if you make 50k a year and start depositing 100k a year it may raise a flag.

Treat it like I have always said counterfitters should do, but they don't. I pay cash for a lot of stuff. I know most people use a card 99.99% of the time now. Just think about every time you buy something if you paid cash for only the small stuff like food, gas, groceries. It adds up in a hurry. But they usually try to launder it so they can buy a house or car with it.

I put in cash often at the bank and only rarely do they fill out a form to ask where it came from. I'm not sure if it's rural or what. I sold my boat for cash and we met at the bank and he paid cash and the bank verified it was not counterfit and I signed over the papers and put the money in right there. Be creative lol. A friend gets paid in cash for a lot of stuff and he said the bank never ask, he did tell me he uses the banks notary often and has them notarize some odd piece of paper someone is signing that is not worth anything and then puts the money in no questions asked. Not cheap amounts, stuff like getting your percentage of a timber sale you negotiated and such.

TJT said:

Sold some RSU this year.

Almost got caught by this. Sale of RSU does not include cost basis, its on the W2 for the year that you received it.

Understanding and Addressing RSU Double Taxation - Tidemark Financial Partners

tidemarkfp.com

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This is a good callout.

More broadly, Fidelity's consolidated 1099 will split out the separate form sections for any short-term and long-term transactions with an unreported cost basis. If you import into tax software, the cost bases will come in as zero, but it's pretty easy to scan the doc and see if you have any that need addressing.

e.g.



At least HRBlock, which I use to file, will also flag any 0 cost basis transactions you import as "requiring an update", so that you are directed to go back and manually enter before proceeding.