401(k) & Company Stock Resource Center

Before employer shares are moved, it can be important to understand the available alternatives and whether NUA could apply. An IRA rollover may be appropriate in some cases, but rolling employer shares into an IRA generally ends the opportunity to use NUA treatment for those shares.

NUA treatment is generally no longer available for employer shares after they are rolled into an IRA. Future taxable IRA distributions are generally taxed as ordinary income under the rules then in effect.

In a qualifying transaction, the plan's cost basis in the employer shares is generally taxed as ordinary income when distributed. Qualifying NUA is generally deferred until sale and then treated as long-term capital gain. Other appreciation and tax factors may be treated differently.

NUA may deserve analysis when a qualified plan holds appreciated employer stock, especially when the basis is low relative to value. Eligibility, current tax, future tax rates, diversification, liquidity, estate goals, and the expected holding period all matter.

No. NUA is complex and is not appropriate for every investor. It can create current tax and continued company-stock risk, and an IRA rollover or another approach may be more suitable in some circumstances.

Potentially. In a properly structured transaction, qualifying employer shares may move in kind to a taxable account while other eligible plan assets move to an IRA or another eligible plan. All NUA requirements must still be met.

Compare the plan, a new employer plan, an IRA, and any distribution choices. Review total costs, investments, services, withdrawal provisions, creditor protections, taxes, employer stock, loans, and the complete retirement plan.

Your job, benefits, and investments may all depend on the same company. A company-specific setback can therefore affect current income and long-term retirement security at the same time.

When vested RSUs are settled, the value delivered is generally treated as compensation income and may be subject to income and payroll taxes. The capital-gains holding period for shares generally begins when the shares are acquired, not when the RSUs were granted. Award terms and individual circumstances can change the result.

There is no blanket answer. Selling can reduce concentration but may create taxes and reduce future participation in the stock. Holding preserves potential upside and company-specific downside. Total employer exposure, cash needs, taxes, restrictions, goals, and risk tolerance all matter.

No. These approaches may change diversification, tax, income, or downside characteristics, but each has costs, risks, eligibility requirements, tax considerations, and limitations. None guarantees tax savings or removes the possibility of loss.