FAQ
There is no taxable event when performance shares are granted. A taxable event occurs once you meet a performance metric and shares are delivered. This often occurs after the board...
Read More What might a Performance Award/Grant look like?
A performance award is generally issued with a target number of shares, an achievement timeline, its metric(s), and a minimum and maximum award. Minimum/maximum awards are typically based on how...
Read More Why Do Companies Use Performance Awards?
Performance Stock Awards (PSAs or PSUs), are meant to reward executives based on their contributions to a company’s objectives and overall progress measurably and harmoniously. The more deliberately a company...
Read More What are the advantages of a qualified employee stock purchase plan?
An ESPP is a convenient way to buy shares of your company stock, as contributions are often deducted pre-tax directly from payroll. In addition, ESPPs may allow you to buy...
Read More What factors should you consider before you participate in an employee stock purchase plan?
Your plan document can tell you how your employee stock purchase plan works, but there are still details to dig into before you can understand if using your ESPP is...
Read More How will participation in your ESPP impact your cash flow?
ESPPs might allow you to contribute up to a maximum percentage of salary, like 10 to 15 percent. Some companies may also allow you to contribute a fixed amount. You...
Read More How Does Income Tax Impact Your Plans to Purchase, Hold, and Sell Shares in an ESPP?
If you participate in an ESPP, you’ll likely hear the terms qualifying disposition and disqualifying disposition. These terms speak to holding period requirements for your ESPP shares that impact how...
Read More How Does the Alternative Minimum Tax Impact My Overall ISO Strategy?
The Alternative Minimum Tax can be a significant concern when exercising incentive stock options, particularly if you have large bargain element, and it’s important to understand how this might impact...
Read More Does the Alternative Minimum Tax apply to me?
AMT can apply for various reasons, such as having certain business deductions or exercising and holding incentive stock options. However, just because you exercise and hold incentive stock options does...
Read More How do I calculate my Alternative Minimum Tax?
The AMT system is parallel to the regular income tax calculation and is calculated using IRS form 6251. The calculation leads to the tentative minimum tax. Generally speaking, if the...
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