Stacy Francis Quoted By Financial Advisor Magazine About Divorce During Bonus Season
By: Francis Financial
February 1, 2022
We are in the thick of bonus season, and equity awards, including but not limited to restricted stock units (RSUs) and stock options are being awarded as part of compensation packages for employees of all levels. Stock options, restricted stock and other forms of executive compensation are among the easiest assets to hide or overlook.
“Stacy Francis, CFP, CDFA, CES, whose practice focuses on advising women during and after divorce, says, “Financial advisors should also include the tax impact of RSUs versus other assets. The employee will pay ordinary income tax rates on the entire value of the RSUs when the shares vest (not when they’re granted) creating a hefty tax bill. If the employee continues to hold the shares after they vest, any increase in the stock price from the value when vested will be taxed at capital gains rates.” Francis shares cautionary stories of reading settlement agreements that were written so poorly that the contract did not sufficiently discuss who would pay the taxes on these valuable assets. In one case, the couple ended up back in court because the agreement required the employee to pay 100% of the taxes and the non-employee spouse was able to receive her portion pre-tax.”
Learn more about the divorce financial planning process and contact Francis Financial today.