Equity is where tax planning either shines or blows up. Time your move and your vest.
Map the instruments. ISOs/NSOs, RSUs, restricted shares, and carried interest each create different tax events: grant, vest, exercise, sale, distribution.
Relocation timing. A vest or exercise just before or after arrival can change where income is taxed. Split-year and source rules complicate the calendar—model scenarios.
Documentation. Keep grant letters, vesting schedules, 409A/valuations, and board approvals. Banks and tax authorities both ask.
Carry nuances. Jurisdictions treat carry differently—some as capital, others as labor. Fund residency and GP/LP locations matter.
Exit readiness. Before a liquidity event, align residency, employer of record, and treaty relief.
FAQ:
- Can RSUs be “capital gains” in my destination? Often not; many treat them as employment income.
- What if I work remotely? Sourcing rules may still tie income to where services were performed. Editor’s Note: Equity planning is a calendar exercise—start months in advance. Tags: Founders, Equity, RSU, Carry