CedarStream Wealth
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EQUITY COMPENSATION PLANNING

You earned the equity.
Give it a clear purpose.

RSUs, ISOs, and NSOs each bring different decisions. Turn your compensation into a plan for the life you want to build.

Let’s talk about your situation

Your compensation.
A more considered plan.

Equity awards connect your career, cash flow, investments, and taxes. We bring your grant agreements, vesting dates, exercise choices, and personal goals into one coordinated plan.

01 / RESTRICTED STOCK UNITS

RSUs: make each vest count.

We connect your vesting calendar to cash needs, withholding, and a deliberate decision about how much company stock to keep.

  1. 01 / GRANTA future award

    Generally no income tax at grant.

  2. 02 / DELIVERYOrdinary income

    Share value generally becomes wage income when delivered, usually at vesting.

  3. 03 / SALECapital gain or loss

    Change from the tax basis: short-term if held one year or less; long-term if held more than one year.

ILLUSTRATIVE / 100 SHARES

$50 at delivery → $70 at sale. $5,000 is compensation income and the initial tax basis. The later $2,000 gain is long-term if the shares are held more than one year after delivery; otherwise short-term.

Assumes shares are delivered at vesting. Deferred settlement and private-company awards can have different timing. Withholding may not cover your final tax liability.

02 / INCENTIVE STOCK OPTIONS

ISOs: two clocks. One coordinated decision.

We weigh exercise cost, potential AMT, liquidity, and concentration risk alongside the possible tax benefit of holding.

  1. 01 / GRANTStart the first clock

    Wait until after the two-year grant anniversary.

  2. 02 / EXERCISEStart the second clock

    Wait until after the one-year exercise anniversary. The spread may trigger AMT.

  3. 03 / QUALIFYING SALELong-term capital gain

    Meet BOTH holding periods and other ISO requirements. Regular-tax gain generally equals sale proceeds minus exercise cost.

Both clocks must finish before a qualifying sale.
From grantMore than 2 years
From exerciseMore than 1 year

Schematic, not a common starting date. Use the later qualifying date.

ILLUSTRATIVE / 100 SHARES

$20 exercise price → $50 at exercise → $70 at sale. A qualifying sale produces $5,000 of regular-tax long-term gain. The $3,000 exercise spread may create an AMT adjustment.

Selling too early is a disqualifying disposition and may produce ordinary income plus capital gain or loss. AMT uses different basis rules. A falling stock price can outweigh a potential tax benefit.

03 / NONQUALIFIED STOCK OPTIONS

NSOs: separate exercise from ownership.

We plan for exercise funding and withholding, then consider whether keeping the shares still serves your broader financial goals.

  1. 01 / GRANTUsually no tax

    For typical employee options without a readily determinable market value.

  2. 02 / EXERCISEOrdinary wage income

    Market value minus exercise price is generally compensation—not a capital gain.

  3. 03 / SALEA separate capital gain

    Later appreciation can be long-term after more than one year of stock ownership; otherwise short-term.

ILLUSTRATIVE / 100 SHARES

$20 exercise price → $50 at exercise → $70 at sale. $3,000 is compensation income; the stock’s tax basis becomes $5,000. The subsequent $2,000 gain can be long-term if held more than one year after exercise. Holding longer does not reclassify the original compensation income.

A few thoughtful questions.

Should I hold shares just to qualify for a lower tax rate?

We compare the potential tax benefit with the risk of keeping more wealth in one company. Your cash needs, deadlines, and comfort with risk guide that decision.

What should I bring to our first conversation?

Your grant agreements, vesting schedule, recent pay statement, stock-plan account details, and latest tax return help us identify the decisions ahead. We use an appropriate secure channel for sensitive documents.

Will you coordinate with my tax professional?

Yes. We connect the proposed equity strategy with your tax professional’s projections and reporting so exercise, sale, and payment decisions work together.

Should I sell my RSUs as they vest, or keep the shares?

We compare holding the shares with the other uses for that money: funding a goal, diversifying, or building reserves. Your existing company-stock exposure, upcoming vesting events, and cash needs help shape a deliberate policy rather than a new decision each time.

Can exercising ISOs create a tax bill before I sell?

Yes. Exercising an ISO may trigger alternative minimum tax even when you keep the shares. Before exercising, we coordinate a projection with your tax professional and consider how you would fund both the purchase and any potential tax bill.

How do we plan around a job change?

Bring your award agreements into the conversation before you leave. We review vesting, expiration dates, and any post-employment exercise provisions with you and your stock-plan administrator so your choices are guided by the actual terms of your awards.

Can you help me plan for several grants vesting at different times?

Yes. We organize the awards into one calendar and connect upcoming events to your goals, cash reserves, and investment plan. That gives us a clearer view of the decisions ahead and the company-stock exposure you may be accumulating.

What if my company stock falls while I am waiting to sell?

We build the plan around more than a hoped-for tax outcome. Together, we consider the effect of a lower share price on your goals and decide how much concentration you are comfortable carrying while you wait.