Amazon RSU
Hello all, Need feedback on RSUs. Working in tech firm for the first time and will be receiving RSUs for Amazon. Fidelity shows that 41% shares will be automatically sold to cover taxes and the remaining RSUs will be awarded in fidelity account. I am confused as what is the best way to proceed. Any input is highly appreciated. Title: Program Manager (L6) TC : 200k NYC YOE: 12+ #amazon #amazonrsu
You have option to keep shares if you want to by paying 41 percent taxes as a cash from your pocket
Thank you
is there a way to understand which option is better when the stock market is rocketing v/s tanking?
The way RSUs work is that a company exchanges them for actual shares and put them in your brokerage account. The market value of the shares automatically becomes taxable as ordinary income, so the company is required to withhold enough shares to pay tax, just like how they withhold part of your income for taxes If they didn’t, then come tax season, you might not have the cash on hand to pay the taxes on vested RSUs. If the company withheld too much, then you’ll get money back as tax return
But isn't 41% tax too much? Like almost half?
41% is deemed based on the OP’s tax bracket.
When the RSUs vest let them take the chunk needed for taxes, don’t pay cash. If you really really want to keep more Amazon stock then you can buy more with the cash instead. That makes the decision more obvious: do I really want to spend cash on extra shares or not? You’ll already have to decide whether to sell or hold the rest of the shares they give you at the same time.
What is your question?
Either way the answer is to sell all. Keeping AMZN while working at Amazon and shopping Amazon is too much Amazon. You’re vested by being employed and getting future stock.