Six instruments make up your real pay — and each one runs on its own tax clock.

Restricted Stock Units are not stock. They’re a promise to deliver stock at vest — until then there’s no property, no 83(b) opportunity, and nothing to tax. At vest, the entire fair market value becomes ordinary W-2 income, whether you sell or hold: ordinary income = shares vested × FMV at vest.^[1] The employer withholds federal, state, FICA, and Medicare — and the default federal withholding for supplemental wages is 22%, which is almost always too low for an executive in the 32%-plus bracket. That underwithholding gap is where surprise April 15 bills come from; ask whether your employer offers a higher elective rate (37% is the supplemental ceiling), or run quarterly estimates.

Stock options are the only common comp instrument where you choose when the tax event occurs — the exercise. That choice can change the rate from 37% to 20%, or create an AMT bill with no cash attached to pay it. Most executive comp damage is done here.^[2]

The AMT trap on exercise-and-hold. The bargain element on an ISO exercise (FMV minus strike) is invisible for regular tax but is an Alternative Minimum Tax preference item. Exercise 10,000 ISOs at a $10 strike with the stock at $90 and hold: regular taxable income is $0, but AMT income is $800,000, taxed at the AMT’s 26%/28% rates. You may owe $200K-plus on shares you can’t legally sell yet, and the company doesn’t withhold for it.^[2] Three things keep this survivable:

• The hidden upside. AMT paid is recoverable as an AMT credit in future years — but only against regular tax in excess of AMT, and recovery can take a decade.
• Sizing the exercise. Exercise up to the AMT crossover — the point where regular tax and tentative AMT are equal. Any ISO exercise inside that ceiling is AMT-free for the year.
• Cash burn. Even if you survive AMT, you owe the strike price in cash. A cashless exercise (sell-to-cover) converts the ISO into a disqualifying disposition. We model the full cash math before any exercise.

An ESPP under IRC §423 lets you payroll-deduct up to $25,000 of stock per year at up to a 15% discount, often with a “lookback” that prices the purchase off the lower of beginning-of-period or end-of-period FMV. With the lookback, the effective discount in a rising market can easily exceed 30%.^[3] The timing rules: a qualifying disposition (sale at least 2 years after the offering start and 1 year after purchase) treats only the discount as ordinary income, everything above as LTCG. An earlier sale is a disqualifying disposition — the entire spread is ordinary W-2.

Section 83(b) lets you accelerate the tax event on restricted property to grant instead of vest. It’s most useful for founders receiving early-stage restricted stock when FMV is essentially zero — elect, pay tax on almost nothing, and the entire post-grant appreciation becomes long-term capital gain. Miss the 30-day deadline and the election is gone forever.^[4]

Once the 401(k) is maxed ($24,500, plus the $8,000 catch-up and the match), the next deferral layer is a nonqualified deferred compensation plan: salary, bonus, RSU proceeds, or PSUs deferred above the qualified-plan ceiling with no dollar limit. The trade: the deferral is an unsecured promise from your employer, the distribution schedule is picked years in advance, and IRC §409A enforces it with immediate tax plus a 20% penalty for any misstep.^[5] The election rules are rigid — salary deferrals elect before the calendar year of services begins; performance-bonus deferrals elect at least 6 months before the performance period ends; the distribution election locks at deferral, with only narrow change rules after. Permitted distribution events: separation from service, a fixed date, change in control, death, disability, unforeseeable emergency. Acceleration is almost never permitted. Pre-tax is attractive — it is — but the cash is the company’s, the form of payment is the company’s, and NQDC dollars sit with general unsecured creditors in a bankruptcy.

Qualified Small Business Stock under IRC §1202 lets a founder or early employee exclude up to the greater of $15 million or 10× basis of capital gain on the sale of qualifying C-corp shares held five years. The One, Big, Beautiful Bill (signed July 4, 2025) materially expanded the rules for stock issued after that date: the issuing-company gross-asset cap rose from $50M to $75M, the individual exclusion from $10M to $15M, and a tiered partial exclusion arrived for 3- and 4-year holds.^[6]

If you are an executive officer, director, or 10%-plus holder of a public company, you are an insider, and every sale must satisfy both Rule 10b5-1 (insider trading) and Rule 144 (resale of restricted or control securities). The standard answer is a pre-committed 10b5-1 trading plan adopted while you hold no material non-public information.^[7] Under the December 2022 SEC amendments, the affirmative defense requires: good-faith adoption with no MNPI; a cooling-off period of 90 days for Section 16 officers and directors (or, if earlier, two business days after the next 10-Q is filed) and 30 days for other employees; no overlapping plans; only one single-trade plan per 12 months; and a good-faith certification by officers and directors. Plans typically specify fixed dollar amounts, fixed share counts, formulas, or price triggers over a 6–24 month window, and companies disclose officer and director plan adoptions and terminations in their 10-Qs and 10-Ks.^[8]

Rule 144 still applies to every sale, because the executive is an affiliate:

• Holding period. 6 months for stock of an SEC-reporting issuer; 1 year for non-reporting.
• Volume limit. In any 3-month window, the greater of 1% of shares outstanding or the prior 4-week average weekly trading volume.
• Manner of sale. Ordinary brokerage transaction, no solicited buyers.
• Form 144. Filed at the time of order when the sale exceeds 5,000 shares or $50,000 in any rolling 3-month period.
• Public information. The issuer must be current on its 10-K and 10-Q filings.

If 30–80% of your net worth sits in a single public company, you have a concentrated-stock problem — even if the stock has done beautifully. There are six ways to reduce it tax-efficiently. Each has a real cost, and the conflicted-product risk on some is well documented.^[9]