If you’ve received stock options or Restricted Stock Units (RSUs) as part of your compensation package, you’re not alone.
RSUs have become one of the most common ways tech companies and high-growth businesses reward talent. But while RSUs can create real wealth, they can also trigger major tax consequences and risk exposure when not managed proactively.
At Arkos, we work with professionals just like you—tech leaders, business owners, and sales executives—helping them make smart, strategic decisions about when (and how) to sell RSUs.
Here’s what you need to know.
Restricted Stock Units are shares of company stock granted to you, but they’re not yours until they vest. Once they vest, they’re considered income—meaning they show up on your W-2 and are taxed as ordinary income.
Key point: Even if you don’t sell a single share, you owe taxes on them once they vest. Often, you can execute on your RSUs unless you are inside your company's quarterly trading window which means, planning ahead can make a big difference from a tax standpoint.
Imagine receiving $250,000 in RSUs that vest over four years. Every year, ~$62,500 vests. That amount is taxed as ordinary income, not capital gains.
But if you hold the shares instead of selling, your total net worth could become heavily tied to your company’s stock. If the stock drops—so does your wealth. And you’ve already paid taxes on the full value.
This creates two major risks:
Concentration Risk – Too much of your net worth tied to one stock
Tax Timing Risk – Paying income taxes today, holding a stock that could fall tomorrow
There’s no one-size-fits-all answer, but here are four strategic questions to guide the timing:
Too often, RSUs are sold haphazardly—or worse, held with no plan. Before you sell, know what you’re doing with the proceeds:
Reinvest in a diversified portfolio?
Pay off debt?
Fund a down payment or college savings?
Give to charity?
Selling with purpose turns income into intentional wealth.
Since RSUs count as ordinary income, they can push you into a higher bracket fast. Selling additional shares could compound the tax bill.
We help clients evaluate:
Whether to sell immediately or wait for capital gains treatment (if held >1 year)
Whether to bunch deductions (charitable giving, donor-advised funds) in high-income years
Whether to spread sales across tax years
As a rule of thumb, if more than 10–15% of your liquid net worth is in one stock, your portfolio is at risk.
We help clients unwind concentration risk over time using:
Automated RSU sale plans
Charitable stock donations to reduce tax impact
Diversified reinvestment portfolios
If you're approaching:
A liquidity event
A sabbatical or job change
Business ownership or relocation ... it may impact how and when you sell RSUs. We advise coordinating RSU planning with your larger financial picture.
Donating appreciated stock (instead of cash) to a Donor-Advised Fund (DAF) allows you to:
Avoid capital gains tax
Deduct the full market value (if held >1 year)
Create a long-term giving strategy
It’s a powerful way to be generous and reduce your tax bill—especially in high-income years.
A client with $850,000 in vested RSUs asked if they should sell everything at once. Analyzing their tax brackets, modeling a three-year sale strategy, and gifting $50,000 in stock to a DAF would lead to an outcome that looks similar to the following:
Avoid a portion of capital gains by gifting and tax-loss harvesting
$50,000 tax deduction in a high-income year
A charitable legacy plan aligned with their values
Letting RSUs sit can feel safe—but it’s often the riskiest path.
You’re exposed to market downturns
You’ve already paid taxes on vested shares
You’re not actively managing that portion of your net worth
Selling with a strategy protects your upside and aligns your wealth with your goals.
We’ve created a free guide to help you make smart financial decisions across every stage of your career:
📥 [Download the Top 5 Financial Decisions Guide]
Want personalized help? Book a 15-minute clarity call:
📞 [Schedule My Strategy Call]
Let’s turn your equity into intentional wealth.