Stock options Archives - Darrow Wealth Management

Business owners Stock options Sudden Wealth Tax planning Updated for 2022

Qualified Small Business Stock Gain Exclusion (Section 1202)

If you invested in a startup or small business (founders, employee exercise of stock options, business owner), you need to know about qualified small business stock. If eligible, you may be able to exclude up to 100% of the gain from federal taxes when you sell your shares. Qualified small…

Kristin McKennaJanuary 5, 2022

Stock options Tax planning Updated for 2022

When to Exercise Stock Options

When should you exercise stock options? With stock options, employees have the right (not obligation) to buy the shares (called exercising). Vesting is often the earliest employees can exercise, though early exercises are possible. If you stay with the company, you'll likely have 10 years from grant to buy the…

Kristin McKennaDecember 21, 2021

Business owners Current events Stock options Tax planning

Expecting a Windfall from Stock Options or Selling a Business? New Tax Proposals May Cost You.

Tax planning for a sudden liquidity event just got more complicated. If you're expecting a big windfall from selling a business or employee stock options after an IPO or acquisition, you may be following the Build Back Better tax proposals. As currently drafted, the bill introduces new taxes on high…

Kristin McKennaNovember 16, 2021

ISOs NQSOs Stock options

What Does it Mean to Early Exercise Stock Options?

If you work for a private company or startup, you may be able to exercise your stock options early. With an early exercise, employees buy unvested stock options, as is common with restricted stock. Why would you want to pay for shares before they vest? In the right situations, early…

Kristin McKennaAugust 23, 2021

Forbes IPO Stock options

5 Stock Option Mistakes to Avoid When Your Company Goes Public

Amidst a flurry of IPOs, many employees are experiencing their first major liquidity event from stock options. Unfortunately, for stock option rookies and veterans alike, there are plenty of potholes you'll want to avoid when your company goes public. The crux of the issue boils down to planning, or lack…

Kristin McKennaJuly 26, 2021

IPO Stock options Updated for 2022

What Happens to Stock Options in a SPAC Merger?

Although the most common way for a company to go public is through the traditional initial public offering (IPO) process, it's not the only method. Although SPACs (special purpose acquisition companies) were first created in 1993, they've recently became a very popular way for a company to go public. This…

Kristin McKennaApril 19, 2021

Diversification IPO Stock options Updated for 2021 Video

Managing Stock Options in a Direct Listing – Going Public Without an IPO

What happens to stock options if a company goes public without an IPO? A Direct Public Offering (DPO) or direct listing is a way for a company to list itself on a public stock exchange without the traditional Initial Public Offering (IPO) process. If you have employer stock options and…

Kristin McKennaApril 1, 2021

Building Wealth Diversification IPO ISOs NQSOs Stock options Updated for 2022

What Does an IPO Mean for Employees? What to Do When Your Company Goes Public.

There were nearly 500 IPOs in 2020. According to data from FactSet, that's just 67 shy of the combined total between 2015 and 2017. And the race to go public isn't slowing down. As of the end of November 16th, 2021, more than 375 companies have gone public via IPO…

Kristin McKennaMarch 6, 2021

Stock options

What Happens to Stock Options When a Public Company Goes Private?

With so much emphasis on IPOs, investors are sometimes surprised when publicly traded companies decide to go private. There are many reasons a company may choose to go private. Dry powder flowing into private equity funds only fuel the trend. For employees of a public company going private via buyout,…

Kristin McKennaOctober 5, 2020

Diversification Forbes Investing Managing Risk Stock options

If You Own Too Much Stock In One Company, It’s a Good Time To Consider Diversifying

Can you own too much of your employer's stock? Undoubtedly, yes. Does holding a lot of company stock create the potential for a large windfall? Also, yes. For employees, it can be difficult to know how much company stock is too much. But identifying a concentrated position is often just…

Kristin McKennaSeptember 21, 2020