omehe...

Try asking this link - it's a moderated tax group.

http://groups.google.com/group/misc....?hl=en&lnk=srg


My first thought would be to negotiate a deferred payment with the
accounting dept of the acquiror, next, I'd look for any losses I could
write off against the short-term gain, following that, I'd probably go
along the route you suggested, with the caveat that Douglas posted
above.

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omehegan[at]gmail.com wrote:

- quote -

Let me be the first to say "Don't let the tax tail wag the investment dog."

Your approach could make sense IF you have an adequate emergency fund, no
expensive debt, your 401K is low cost, and you really want to tie up the money
until retirement.

Also, look to see if you need to make an estimate tax payment on the proceeds.

-- Doug

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The company I work for was recently bought. It was a cash sale, and I
had vested stock options which I had not exercised. As a result, I
will be given cash for my existing options, which is a nice windfall,
but it'll amount to a short term capital gain for this year's taxes.

My understanding is that I'll be given the full payout for my options
now, and then I'll have to pay taxes on them when I file next year. In
the meantime, I'd like to do what I can to minimize the unexpected tax
hit I'll be taking. I have a 401k and a Roth IRA. My thought was that
I would contribute the maximum to the IRA for this year, and keep the
rest of the money as cash. At the same time, I'll increase my 401k
contributions substantially, to lower my overall taxable income for
2007, and use the stock money to make up the difference. I figured
that this made more sense than putting the money in a CD or something,
where I would be taxed on the earnings. Is this logic sound? Is there
anything else I should consider in this scenario?

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to keep the conversations on-topic for financial planning. Other posting
guidelines include a request for brevity and another for trimming posts to
which we respond. For all of the other tips and suggestions, see "FROM THE
MODERATORS: Posting to misc.invest.financial-plan", a weekly post now on the
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