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//// Financial · Equity Compensation

Equity & Stock Options Calculator

ISO, NSO, or RSU? Model your spread, exercise tax, AMT exposure, and the hold vs sell-now tradeoff — with federal, state, and long-term capital gains rates all factored in.

Where this fits

📈 Investing & WealthTrading IncomeTraders

This tool lives inside Trading Income and is most useful for traders.

401(k) Limit 2024$23,000
Roth IRA Limit$7,000
S&P 500 Avg Return~10%/yr

Option Type

Non-Qualified Stock Options — spread (FMV − strike) taxed as ordinary income at exercise. Post-exercise appreciation at LTCG if held 1yr+.

Grant Details

Tax Rates

LTCG rate
Federal LTCG rate
Spread
$55K
(FMV − strike) × 10,000 shares
Tax at Exercise
$16K
Ordinary income on spread (29%)
Net — Sell Now
$39K
After all taxes today
Net — Hold to Exit
$175K
At $25.00/share

Hold vs Sell Now

$39K
Sell Now (net)
All ordinary income tax applied today
$175K
Hold to Exit (net)
+$136,000 advantage

Holding to a $25.00/share exit saves $136,000 in taxes vs selling today. Requires holding the qualifying period for 1yr from exercise.

Tax Notes

• NSO: spread at exercise is ordinary income. Post-exercise appreciation is LTCG if held 1yr+.

1

Spread (paper gain at exercise)

spread = (FMV − strike) × shares

($8.00 − $2.50) × 10,000

= $55,000

NSO: this spread is ordinary income at exercise.

2

Tax at exercise / vest

tax = spread × (federalRate + stateRate)

$55,000 × 29%

= $15,950

3

Exit scenario — hold to expected price

exitGain = spread × ordinary + (exitPrice − FMV) × shares × LTCG

exit at $25.00/share

= Net: $175,050

Hold advantage over sell-now: $136,000

4

Hold vs sell-now comparison

holdAdvantage = holdNet − sellNowNet

$175,050 − $39,050

= +$136,000 advantage to holding

Key insight

NSOs are straightforward but double-taxed: ordinary income at exercise, then LTCG on subsequent appreciation. The hold vs sell calculation here shows whether waiting for LTCG treatment on post-exercise gains is worth the concentration risk.

Use this result in →

Roth vs Traditional →HSA Optimizer →Business Loan →

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