Tax Status
Understand my Performance Grant Tax Status
When you receive your restricted stock grant, you may have a choice to pay your income tax at grant or at vest.
In the United States, to pay your tax at grant, you must file a Section 83(b) election with the IRS within 30 days of your grant date (rules in other countries may differ). If you pay your income tax at grant, the tax is calculated based on the value of the stock on the grant date. Remember that if your grant is canceled, the tax you paid is not refundable. If you do not file a Section 83(b) election, then income tax on the shares will be due on the vest date.
E*TRADE displays your current Tax Status by vest date:
- Paid at Grant means that the tax for shares vesting on the vest date were paid on (or near) the grant date.
- Paid at Vest means that the tax for shares vesting on the vest date were paid on (or near) the vest date.
- Due at Vest means that the tax for shares vesting on the vest date are due on (or near) the vest date.
- Deferred to Release means that your employer allows you to defer the release of your shares until some time after the vest date, and that you made this deferral election. Because the shares are not released to you upon vesting, you do not have to pay income tax on them until they are released to you (you may still have to pay Social Security and Medicare taxes when the shares vest). Note that this election must be made under a formal deferral program offered by your employer and the election must usually be made six months or more before your shares vest. The Deferred to Release status will not change if you have already paid the tax or if your payment date is in the future.
- NA stands for not applicable. This would be the case if the shares were canceled before any tax is paid.
E*TRADE displays your tax status based on information provided by your employer and US federal tax regulations, and does not provide advice regarding when you should pay your income tax. Stock plans and tax regulations differ by company and country, so be sure to consult your tax advisor
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