My stock checklist full#

The decision to sell is purely an investment decision, and diversifying your investments by selling your RSU shares right away is the best investment decision for most people. There will be no additional tax owed if you sell right away, and there is no tax benefit to holding your shares. You may need to wait until your company’s next open stock trading window. Sell your vested RSU shares as soon as you can. Many companies withhold federal income tax on RSUs at a rate of 22%, which may be too low for your situation.

My stock checklist full#

Be sure to set your income tax withholdings to cover your full tax obligation. Remember, when RSUs vest, the value of the shares you receive are taxed as ordinary income at your regular income tax rate (not the lower long-term capital gains tax rate). Determine if the income tax withholdings on your RSU income will be sufficient to cover the amount of tax you will owe. This line item has to do with the fact that income on RSUs is non-cash income, and an adjustment must be made on your paystub to show you did not receive cash for the income represented by the shares you received.) (Note that there may be a confusing line item on your paystub labeled “RSU Offset,” “Stock Offset,” or something similar. Continue to check this periodically going forward. The amount of income should be equal to the number of shares that vested in that pay period times the price of the shares when they vested. Confirm your paystub shows income from RSUs. Confirm you received the correct number of shares in the stock plan account the company has set up for you at a brokerage firm. Each new grant of RSUs has a separate schedule that specifies when you will start receiving shares, how often you will receive shares, how many shares you will receive each time, and how long you will continue to receive shares. Make sure you understand the vesting schedule for your RSUs. This configures how income tax will be withheld on the value of the shares you receive.

Accept your grants on the company’s stock plan website when you receive them. If you work at a publicly traded company, you can utilize the following list that includes best practices we recommend to clients. Following a checklist is a great way to make sure you get the most out of your restricted stock units (RSUs), manage them effectively, and avoid common mistakes.