I'm an engineer at a recently public unicorn. We've gone public in H1 this year, and I'll be able to sell stock grants that have vested over the last few years of working here. I'm looking for help on what fraction to sell, and how to do so in tax-advantaged situations.
Numbers:
- Age: 29
- Location: San Francisco
- Current salary: 220K
- Current annual stock grants: ~400K at current share price
- Current vested equity: ~700K at current share price, tax already withheld at ~53% (Fed, CA, Social Security)
- Net-worth: ~230K: [170K in 401K, 40k in ETFs, 20K emergency fund, no debt.]
Big questions I have:
- What percentage makes sense to sell when the employee lockup expires to balance risk? I recall guidance to not let a single stock make up more than 10% of your portfolio, but selling so much makes me worry about taxes, especially because of this next point:
- I paid tax on the equity based on the IPO list price, and shared were withheld on my behalf. The current price is ~40% higher than the list price, and I believe selling this year would realize those gains as short-term, while I can realize them as long-term if I wait to sell in Q2 of 2020. Does it make sense to avoid selling for another ~6 months? I almost see the change in taxes on the appreciation as a hedge for a drop in the stock price.
Submitted July 04, 2019 at 06:57PM by financialadviceplzz https://ift.tt/2LBj4nz
