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Silicon Valley Unites to Preserve Equity Compensation

silicon valleytax planequity compensationsenategop tax bill
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Shriram Bhashyam   November 16, 2017

It was fast and furious, but in the end the US Senate ultimately came around. The Senate's version of the tax bill to implement sweeping changes and cuts to the tax code, the Tax Cuts and Jobs Act, included a provision that would have taxed stock options and restricted stock units (or RSUs) upon vesting. This would have been disastrous for the startup community, which relies heavily on equity awards to compensate employees. The startup community quickly rallied to inundate local Senators with opposition to this provision, and late Tuesday night, November 14, 2017, the Senate relented and struck that provision. We break down why this matters and how it was resolved.