Is the first day of the offering period always the same as the "grant date" in the context of employee stock purchase plans (ESPP)?
Is the first day of the offering period always the same as the "grant date" in the context of employee stock purchase plans (ESPP)?
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Franck Dernoncourt · External communityPost link
External question — Personal Finance Stack Exchange
Author: Franck Dernoncourt
Original post: https://money.stackexchange.com/questions/119620
License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/
Adaptation: HTML converted to plain text; contact email addresses removed.
Is the first day of the offering period always the same as the "grant date" in the context of
employee stock purchase plans (ESPP)
in the United States?
Motivation to ask the question:
I'm asking as I read on
https://blog.wealthfront.com/good-espp-no-brainer
(
mirror
) :
Unlike a 401(k), your contributions to the ESPP are taxed at ordinary income rates. If you hold your shares for more than a year after the purchase date AND more than two years after the
beginning of the offering period
then any profit above the gain from the discount will be taxed at [long-term] capital gains tax rates.
but the financial institution (namely,
E-Trade
) that manages the ESPP I am looking at only displays the "grant date" in their ESPP section (
https://us.etrade.com/etx/sp/stockplan/#/holdings
) and doesn't mention any first day of the offering period , from what I can see. The answer to the question would be useful to make sure to wait two years after the beginning of the offering period so that any gain is taxed at
capital gains tax rates
.
Screenshot from
https://us.etrade.com/etx/sp/stockplan/#/holdings
:
I have crossposted the question at:
https://qr.ae/TD2ftZ
https://redd.it/eung7o
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Franck Dernoncourt · External communityPost link
External answer — Personal Finance Stack Exchange
Author: Franck Dernoncourt
Original post: https://money.stackexchange.com/a/119659
License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/
Adaptation: HTML converted to plain text; contact email addresses removed.
Answer from
https://fairmark.com/compensation-stock-options/employee-stock-purchase-plans/dispositions-of-espp-stock/
:
For this purpose, the grant date is normally the beginning of the offering period
. Tax regulations issued in 2009 specify that
in some situations the end of the offering period
(when you purchase the shares)
will be considered the grant date
. Your company should inform you if this is the case.
Follow-up question:
In what case(s) the end of the offering period (when one purchases the shares) is considered the grant date?
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Quoted from Forex.com.bd-Editorial External answer — Personal Finance Stack Exchange Author: Franck Dernoncourt Source score (net votes, not local likes): 1 Original post: https://money.stackexchange.com/a/119659 License: CC BY-SA 4.0 — https://creativecommons.org/licenses/by-sa/4.0/ Adaptation: HTML converted to plain text; contact email addresses removed. Answer from https://fairmark.com/compensation-stock-options/employee-stock-purchase-plans/dispositions-of-espp-stock/ : For this purpose, the grant date is normally the beginning of the offering period . Tax regulations issued in 2009 specify that in some situations the end of the offering period (when you purchase the shares) will be considered the grant date . Your company should inform you if this is the case. Follow-up question: In what case(s) the end of the offering period (when one purchases the shares) is considered the grant date?
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