Tag Archives: Nelson Formula

Dividing Stock Options and Restricted Stock In Divorce

Orange County Divorce and Employee Stock Options

by Thea Glazer, CFP®, CDFA™, MS Accounting
Glazer Financial Advisors, Laguna Hills, California

Stock options and restricted stock may be part of the marital estate. And they are some of the more complex assets. This brief overview provides a basic understanding of the factors you need to take into consideration. It does not go into all the many tax and technical issues that are aspects of equity compensation. Seeking professional guidance for your specific circumstances is always a good idea.

Many companies grant their employees equity compensation in addition to their salaries, commissions and cash bonuses. Equity compensation is non-cash compensation representing a form of ownership interest in a company. Among the most common are employee stock options and restricted stock or restricted stock units. In divorce, stock options and restricted stock are property to be divided. The employee’s separate shares are often also considered as income in the calculations of support.

Employee Stock Options (ESOs)

An employee stock option is the right given by an employee to purchase a specified number of shares of the employer’s stock for a specified price and for a specified time. There are two types of ESOs, Incentive Stock Options (ISOs) and Nonqualified … Read More “Dividing Stock Options and Restricted Stock In Divorce”