How To Get The Most From Your Employee Stock Purchase Plan (ESPP)

[@creatinechris]

4:29 - Disqualifying Dispositions are not completely subject to ordinary income tax rates. Ordinary Income will be the Purchase Price (aka price at end of offering period) MINUS what you paid for the stock (price at beginning of offering period MINUS discount). The rest is either long term or short term gain depending on how long you held the stock after purchase.

[@DanielFarrell]

Yeah the online calculators seem to show no difference in returns if you sell for the same price as the FMV at the buy moment. If there's a slight change up or down, the after-tax difference is very small (

[@creatinechris]

@@DanielFarrell Yeah generally that's what I advise my clients to do unless we've carved out a section of their portfolio that they are proactively choosing to devote to company stock. In that case the discount can be very helpful long term.

[@shyamt5525]

I found this video very useful. It has all the info I was looking for. A big thanks to Prana Wealth for making this video on KZbin!

[@ThrillFishing]

Just subscribed. Crazy how clear and concise all of the information was without even using any graphics or numbers. Really need clarification on what was taxed and how, this cleared at all up. Thank you!

[@HowToRetire]

Awesome! Thank you!!!

[@calvinlivengood5717]

Very informative! Thank you

[@BeedeeEx]

Very clear and concise explanation of everything! Thanks!

[@HowToRetire]

Thanks for watching and thanks for the kind words!

[@summer-plumeria]

Really helpful, thank you!

[@HowToRetire]

@DenimAndLeather -- I'm so happy you got something out of it! Thanks for the kind words and here's to maximizing that ESPP! 🙏

[@MrPdiddy08]

Great video…thank you

[@HowToRetire]

Glad you enjoyed it, @Proud Dad 2014 ! Thanks for watching and thanks for the comment! 🙏

[@Ease_29]

​@@HowToRetirehi ,is it known as sweat equity shares or not 🚫

[@dishaghosh2274]

Very Informative :) , Thank you.

[@HowToRetire]

I'm happy you enjoyed it, Disha! Thanks for the kind words!

[@cybrainx72]

ERROR: Wrong info with respect Non qualifying disposition @4:26 , Non disqualifying disposition have two scenario a. one with long term capital gain and b. other without short term cap gain. (a) seems to have been swallowed.

[@jimdonahue5723]

Are your payroll contributions/deductions to a qualified ESPP, that are held in escrow added to your income on your W2? Thank you.

[@toranaga1969]

My company has recently offered an espp but already shares purchased through a brokerage account. Would this cause any sort of issue?

[@amyx231]

I have like 1/3 my entire net worth in my ESPP. I’d like to sell. But the oldest lots are red - wash sale rules give me a headache just thinking about the taxes. I wish I could sell maybe 1/5 of it and put it into an index fund or 5 though. But taxes and wash sale rules…. Im planning to do it in 2022. As soon as I hit green for the older lots.

[@HowToRetire]

Selling in chunks is a great idea, AmyX. As far as wash sale rules go, they only apply if you repurchase the same stock. If 1/3 of your net worth is in your employer stock, it may be a good idea to diversify. As far as taxes go, long-term capital gains is the best deal you're gonna get from Uncle Sam (unfortunately). Great job of saving and good luck!

[@amyx231]

@@HowToRetire ESPP buys every 6 months. And dividend reinvestment is every 3 months. So Id have to time it tightly to avoid wash sale rules. Yes, I’ve tried to turn off dividend reinvestment. Apparently it can’t be? Must be the plan rules.

[@HowToRetire]

Amy, you may want to check with your CPA on this. I think the wash sale rules apply for only 30 days. If you have a 3 month window, you should be able to make some sales. fairmark.com/investment-taxation/capital-gain/wash/ But please be sure to confirm with a CPA to be sure.

[@amyx231]

@@HowToRetire Right. But the entry point was high. I’d like to break even at least. Avoid wash sale rules and make some money too. But yeah, 30 days is the rule. So I’d have a couple weeks of safety twice a year (cause the twice a year buys). Still, will take planning.

[@JordanGonzalezvlogs]

This video is everything I can wanted to know thank you my guy🙏🏼 Liked & Subbed🥀🖤

[@thenick95051]

How do you tax a discount?

[@stebarg]

I don't understand all this.

[@LeNguyen-im8dm]

Yeah. because there is no writing or drawing to visualize for those people who never heard about ESPP.