Message Font: Serif | Sans-Serif
No. of Recommendations: 6
So if theres a "trick" you don't have to worry about it. (I don't think there is a trick though)

Actually, there is a trick with company stock and 401(k)'s. Actually, a couple. First, you can elect to have dividends distributed penalty-free while you're working.

Second, when you leave the company you can take the stock as a distribution and not pay tax (immediately) on the Net Unrealized Appreciation (NUA). The NUA is the difference between what you paid for the stock and what it's worth at distribution. It's a way of turning what would otherwise be ordinary income into a long-term capital gain.

Details are in IRS Publication 575, and I think there's an article in the Retirement section of the Fool ("Taking Stock"?).

Print the post  


In accordance with IRS Circular 230, you cannot use the contents of any post on The Motley Fool's message boards to avoid tax-related penalties under the Internal Revenue Code or applicable state or local tax law provisions.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.