Quicken Please Update Quicken Product to Handle Restricted Stock Units....Please Please Please!!!

WindyCityME

Many companies use Restricted Stock Units (RSUs) as a form of Compensation to various employees.  Quicken Handle Employee Stock Purchase Programs and Stock Option Grants.  Please modify the Quicken Program to hand Restricted Stock Unit Grants as well.

Tom Young

What, exactly, do you wish to see?

An RSU is just another versions of a non-qualified stock option, typically requiring no out of pocket cost on your part and gets "exercised" when it vests.  The only thing Quicken doesn't allow here is a $0 exercise price but $.000001 is allowed and probably won't affect anything, really.

wspotmeyer

Tom Young said:

What, exactly, do you wish to see?

An RSU is just another versions of a non-qualified stock option, typically requiring no out of pocket cost on your part and gets "exercised" when it vests.  The only thing Quicken doesn't allow here is a $0 exercise price but $.000001 is allowed and probably won't affect anything, really.

Tom, the problem is that RSUs are considered income at the time of vesting.  If I exercise an option there are no tax consequences if I purchase the stock; with an RSU grant, the vesting shares are considered income from the company and I have to pay income taxes on them at the time of vest.

In my case, this year I got dozens of shares that I can only track by using an "Add Shares" transaction. Unfortunately, "Add Shares" does not allow me to categorize the transaction as income for tax planning purposes. The tax planner does not know to include that income in my tax forecast for the year and it's throwing all the numbers off.

A simple thing to do in the short term would be to add a Category field to the "Add Shares" transaction. I can then manually add MiscExp items for the various taxes I have to pay.

A better long-term solution would be to have a wizard much like the stock option wizard that would include future vesting transactions and tax items.

And, of course, could you please make it available on Mac as well? ;-)

Hope that helps.

Ray Cosner

Tom Young said:

What, exactly, do you wish to see?

An RSU is just another versions of a non-qualified stock option, typically requiring no out of pocket cost on your part and gets "exercised" when it vests.  The only thing Quicken doesn't allow here is a $0 exercise price but $.000001 is allowed and probably won't affect anything, really.

In my experience, RSUs produce taxable income when they are exercised (sold).  Vesting (so that they are eligible to be sold by you) is not a taxable event.  

You can enter option grants in an investment account, the transaction type in the drop-down list is "Grant Employee Stock Option".  This will lead you to identify the schedule for vesting of that grant of options, and also the expiration date.  When you exercise (liquidate) options, the transaction type is "Exercise Employee Stock Option".  I suggest setting up a separate investment account to hold your options.  In this account, go to "Account Details" then the "Tax Schedule" button and select that transfers out of that account are taxable income (in my case, ordinary salaried income).

Please consult the issuer of your RSUs or your professional financial advisor, to ensure that my experience also applies in your situation.

jr7107

Not tax advice, but an example of how to present based on description. If it is income, create an "Income" transaction for the gross number. Purchase the RSUs at "vesting" date. If you paid cash for taxes, complete a separate "Misc Exp" transaction for Fed/State/SocSec/Med. If you netted shares, sell shares at vesting price (for no gain), and then pay taxes with "Misc Exp" transaction. 

Also not tax advice, but the RSUs I have experience with cost basis will be price as of vesting date, but also the gross is taxable immediately as "Income". There are some other special provisions, but deep in the weeds of tax. Check with your tax advisor as to the method of cost basis and then we can figure out the best way to present in Quicken.

jr7107

jr7107 said:

Not tax advice, but an example of how to present based on description. If it is income, create an "Income" transaction for the gross number. Purchase the RSUs at "vesting" date. If you paid cash for taxes, complete a separate "Misc Exp" transaction for Fed/State/SocSec/Med. If you netted shares, sell shares at vesting price (for no gain), and then pay taxes with "Misc Exp" transaction. 

Also not tax advice, but the RSUs I have experience with cost basis will be price as of vesting date, but also the gross is taxable immediately as "Income". There are some other special provisions, but deep in the weeds of tax. Check with your tax advisor as to the method of cost basis and then we can figure out the best way to present in Quicken.

I wrote "purchase the RSUs", but meant purchase the underlying security as a clarification.

Ray Cosner

jr7107 said:

Not tax advice, but an example of how to present based on description. If it is income, create an "Income" transaction for the gross number. Purchase the RSUs at "vesting" date. If you paid cash for taxes, complete a separate "Misc Exp" transaction for Fed/State/SocSec/Med. If you netted shares, sell shares at vesting price (for no gain), and then pay taxes with "Misc Exp" transaction. 

Also not tax advice, but the RSUs I have experience with cost basis will be price as of vesting date, but also the gross is taxable immediately as "Income". There are some other special provisions, but deep in the weeds of tax. Check with your tax advisor as to the method of cost basis and then we can figure out the best way to present in Quicken.

For the RSUs I have, the cost basis is the stock price at the grant date, not the vesting date.  Also, taxes are due at the time of the grant for income based on the value of the options at the grant date.  Often, the issuer pays these taxes directly to the IRS in your name (just like payroll withholding), by reducing the size of the grant as necessary to pay the taxes.  

When the options are exercised, tax is due on the increase in value since the grant date. I have not had to deal with a drop in value at the exercise date, but I assume it would be reported on your taxes as a loss (short term?  long term?).  I also have not had to deal with options that expire without being exercised.

This illustrates why it is vital for you to get tax advice from a professional who knows the details of you exact situation with your RSUs. 

jr7107

jr7107 said:

Not tax advice, but an example of how to present based on description. If it is income, create an "Income" transaction for the gross number. Purchase the RSUs at "vesting" date. If you paid cash for taxes, complete a separate "Misc Exp" transaction for Fed/State/SocSec/Med. If you netted shares, sell shares at vesting price (for no gain), and then pay taxes with "Misc Exp" transaction. 

Also not tax advice, but the RSUs I have experience with cost basis will be price as of vesting date, but also the gross is taxable immediately as "Income". There are some other special provisions, but deep in the weeds of tax. Check with your tax advisor as to the method of cost basis and then we can figure out the best way to present in Quicken.

Exactly right, ask your tax people first. Then figure out how to present in Q.