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Company Stock Tax Success Story

Company Stock Tax Success Story

| August 30, 2017

Take a look at our most recent SUCCESS STORY; a corporate executive reduces his over-weighed company stock exposure through a professionally coordinated option trigger strategy converting taxes on gains from ordinary income rates to capital gain rates.


Situation:  A corporate executive’s publicly traded company stock, held through his executive benefit options program, grew to 50% of his families investable assets.  He wanted to reduce this exposure to 30%, while hoping to minimize the tax expense of the large stock gain.  


Challenge:  How to trigger stock options to ensure sale proceeds are taxed at long-term capital gain rates rather than ordinary income rates. 


Implementation:  WPP, after collaboration with the clients CPA, was able to coordinate and implement an Incentive Stock Option (ISO) swap and held the shares for the required holding period before they were sold.  No Alternative Minimum Tax (AMT) preference items were added back to adjusted gross income based on his tax situation.  He realized a long term capital gain and not ordinary income rates on the sale proceeds….20% versus 39.6%.


A substantial four figure income tax savings!


Call or shoot us an email if you think you can benefit from this strategy or would like to learn more.

This case study is for educational purposes. All situations are different and this case study does not have regard to the specific planning objectives, financial situation and the particular needs of any specific person who may view this example.