Concentrated Stock positions require special strategies to achieve liquidity while minimizing tax impact.
Many executive clients have concentrated stock positions from their compensation packages. For this reason, they are wary of the capital gains tax that would be triggered by a direct sale. This keeps them from diversifying the assets which often represent a significant portion of their portfolios. While concentrated stock is often the result of great professional or investment achievements, it can also represent the greatest source of risk in one’s portfolio.
Reshape focuses on solutions that enable clients to transfer appreciation without triggering capital gains tax. We help our clients leverage tax advantageous distribution strategies, structure lifetime payment streams to clients and their families, and arrange loans against the stock. Reshape makes use of options strategies to help clients collect excess income while slowly diversifying out of large company positions.
We also help our clients use concentrated stock to generate an immediate charitable tax deduction for contributions made in future years.