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I know I will be responsible for short-term capital gains. But what I haven't seen addressed is that I'm normally taxed
in the 28% bracket. My bonus was taxed at the 42% bracket.

I'm fairly ignorant myself... but are you counting *all* your taxes? Your state as well as your federal and your SS/Medicare taxes? I ask, because I've observed the same phenomenon when I exercise stock options on a same-day sale basis. The company handles all withholding as if the sale proceeds were regular income, which totals 42% or so once state and FICA are included.

What I'm guessing they did is tax your bonus and invest the remainder, just as if your got a bonus, were taxed, and then bought the stock on your own. Should they have? You've got me there...
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