Daniel Zajac, CFP | Equity Compensation with Daniel Zajac

The 10b5-1 Plan: 8 Frequently Asked Questions and Recent Updates

by Daniel Zajac, CFP®, EA | Last updated Mar 28, 2024

If you’re an executive or an employee with significant equity in your company from employee stock options, restricted stock units, or other stock grants, you may have a continual need to sell stock. However, SEC regulations, company insider trading policies and fears of allegations of insider trading may prevent proper diversification of holdings. Fortunately for executives and insiders, Rule 10b5-1 trading plans can allow flexibility to sell stock without regard to limitations imposed by company insider trading policies while complying with SEC regulations. Such plans also provide an affirmative defense to allegations of insider trading.

A Quick Take on the Tax Treatment of Incentive Stock Options

by Daniel Zajac, CFP®, EA | Last updated Feb 1, 2025

If your employer has granted you incentive stock options (ISOs), you’ve likely spent time researching the tax treatment. If so, you’ve probably read about the alternative minimum tax (AMT), and qualifying and disqualifying dispositions. Perhaps the complication has left you wondering: What does this mean to me as a taxpayer?

Simplifying the Equity Compensation Complexities: Keep it, Spend it, or Save it

by Daniel Zajac, CFP®, EA | Last updated Dec 19, 2023

If you’re wondering how to maximize the value of your incentive stock options (ISOs), non-qualified stock options (NQSOs), restricted stock units (RSUs), or other forms of equity compensation, you’re not alone. After all, there is plenty to think about if you’ve been granted equity compensation. You may dream of how to strike it rich. You may fear you’ll do something wrong and miss out. You might become mired in taxing technicalities, including AMT calculations. All that thinking can backfire if “TMI” (too much information) prevents you from proceeding.

A Comparison of Employee Stock Options vs. Restricted Stock Units

by Daniel Zajac, CFP®, EA | Last updated Oct 24, 2023

Employee stock options and restricted stock units are collectively discussed under the umbrella of equity compensation. As equity compensation, they have some similarities. Yet they also have a lot of differences. It is these differences that are reviewed and highlighted in this article.

Comparing Incentive Stock Options and Non Qualified Stock Options

by Daniel Zajac, CFP®, EA | Last updated Mar 30, 2024

Non-qualified stock options and incentive stock options are the two types of employee stock options that you may receive as part of your compensation package. While they have some similarities, they also differ, particularly when speaking to how they may be taxed at exercise and upon the final sale of stock.

Why Exercising Incentive Stock Options When the Stock Price is Down May Not Be Your Best Strategy

by Daniel Zajac, CFP®, EA | Last updated Mar 31, 2024

Wouldn’t it be great if your company stock price only ever went up—especially if you’re participating in its growth through incentive stock options (ISOs)? Unfortunately, that’s not always how the world turns. If the share price goes down instead, you may be bummed to see the value of your incentive stock options is less than what it once was. However, a down stock price might mean that you could score some tax breaks if you exercise and hold some of those ISOs. When the price is down, the move might help minimize alternative minimum tax (AMT).

What Equity Compensation Shares Are the Best to Contribute to a Donor Advised Fund? Part 2

by Daniel Zajac, CFP®, EA | Last updated Nov 7, 2024

To achieve this win-win ideal, it’s important to be deliberate about which equity compensation share lots you donate, as well as whether you donate them as post-sale cash proceeds, or unsold shares. We concluded that cash isn’t necessarily king when donating to a DAF. Directly donating low basis, long-term shares usually reigns supreme.

What Equity Compensation Shares Are the Best to Contribute to a Donor Advised Fund? Part 1

by Daniel Zajac, CFP®, EA | Last updated Nov 7, 2024

If there’s such a thing as a match made in philanthropic heaven, it may be the ability to donate a portion of your equity compensation shares to a Donor Advised Fund (DAF). DAFs are relatively easy to fund, easy to manage, and they ensure that you get a tax deduction for the full, appreciated value of your donated stock.

How Incentive Stock Options May Be Taxed: And Some Caveats About Seeking A Qualified Disposition

by Daniel Zajac, CFP®, EA | Last updated Mar 31, 2024

Who doesn’t love a great tax break? You and I can’t personally reverse a bear market or revise Federal regulations. But we do get to decide when and how to exercise, hold, and sell our incentive stock options (ISOs), dictating whether we have a qualified disposition or disqualified disposition. Why not make best use of your tax-planning powers when you do?

Should You Really Sell Your Vested Restricted Stock Units? The Answer Is a Resounding “Maybe”

by Daniel Zajac, CFP®, EA | Last updated Mar 31, 2024

Do you hold Restricted Stock Units (RSUs) that are about to vest, or have recently vested? That probably means you’re a valued employee, so congrats on that. Still, vested RSUs are a taxable event in your life, as well as a financial planning conundrum: Are you better off hanging onto the vested company stock you now hold, or selling them, to reinvest the proceeds elsewhere? A common—and often correct—consensus is to sell the vested stock shares that originate from vested RSUs.

I’m Daniel Zajac, CFP®

The 10b5-1 Plan: 8 Frequently Asked Questions and Recent Updates

A Quick Take on the Tax Treatment of Incentive Stock Options

Simplifying the Equity Compensation Complexities: Keep it, Spend it, or Save it

A Comparison of Employee Stock Options vs. Restricted Stock Units

Comparing Incentive Stock Options and Non Qualified Stock Options

Why Exercising Incentive Stock Options When the Stock Price is Down May Not Be Your Best Strategy

What Equity Compensation Shares Are the Best to Contribute to a Donor Advised Fund? Part 2

What Equity Compensation Shares Are the Best to Contribute to a Donor Advised Fund? Part 1

How Incentive Stock Options May Be Taxed: And Some Caveats About Seeking A Qualified Disposition

Should You Really Sell Your Vested Restricted Stock Units? The Answer Is a Resounding “Maybe”

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