Secfi

𝗪𝗵𝗮𝘁 𝗮𝗿𝗲 𝘁𝗵𝗲 𝗼𝗽𝘁𝗶𝗼𝗻𝘀 𝗳𝗼𝗿 𝗳𝘂𝗻𝗱𝗶𝗻𝗴 𝘆𝗼𝘂𝗿 𝘀𝘁𝗼𝗰𝗸 𝗼𝗽𝘁𝗶𝗼𝗻𝘀 (𝗶𝗳 𝘆𝗼𝘂 𝗱𝗼𝗻'𝘁 𝗵𝗮𝘃𝗲 𝘁𝗵𝗲 𝗰𝗮𝘀𝗵)?     Exercising stock options can come with a significant upfront cost, and not everyone has the cash on hand to cover it. The good news? There are alternative ways to fund an exercise without using your own savings.     📌 𝟭. 𝗦𝗲𝗹𝗹-𝘁𝗼-𝗖𝗼𝘃𝗲𝗿 (𝗖𝗮𝘀𝗵𝗹𝗲𝘀𝘀 𝗘𝘅𝗲𝗿𝗰𝗶𝘀𝗲) How it works: You exercise your options and sell a portion of your shares immediately (via a 𝘁𝗲𝗻𝗱𝗲𝗿 𝗼𝗳𝗳𝗲𝗿 or 𝘁𝗵𝗲 𝘀𝗲𝗰𝗼𝗻𝗱𝗮𝗿𝘆 𝗺𝗮𝗿𝗸𝗲𝘁) to cover the cost. • Pros: No upfront cash needed. Often facilitated by a broker or administrator. • Cons: You give up some potential upside by selling shares early, and you may owe taxes at the time of sale. 📌 𝟮. 𝗧𝗿𝗮𝗱𝗶𝘁𝗶𝗼𝗻𝗮𝗹 𝗟𝗼𝗮𝗻 How it works: You take out a loan (e.g., a margin loan, HELOC) to cover the cost of exercising your stock options. • Pros: No need to liquidate other investments or use personal cash. • Cons: Loans come with interest and must be repaid, even if your company doesn’t exit. 📌 𝟯. 𝗡𝗼𝗻-𝗥𝗲𝗰𝗼𝘂𝗿𝘀𝗲 𝗙𝗶𝗻𝗮𝗻𝗰𝗶𝗻𝗴 How it works: A lender covers your exercise costs in exchange for a portion of future proceeds, using your stock as collateral. • Pros: No upfront cash required, and if your company doesn’t exit, you owe nothing. No personal assets at risk. • Cons: May involve fees and interest, which could reduce your net proceeds in a successful exit. 💡 Choosing the right option depends on your financial goals and risk tolerance. Check out Secfi's liquidity options here: https://lnkd.in/eAPmV7_R

𝗪𝗵𝗮𝘁 𝗶𝘀 𝘆𝗼𝘂𝗿 𝗲𝗾𝘂𝗶𝘁𝘆 𝗮𝗰𝘁𝘂𝗮𝗹𝗹𝘆 𝘄𝗼𝗿𝘁𝗵? If you own private company stock, you’ve probably noticed that there’s no single answer to this question. 409A valuations, funding round prices, secondary market transactions—each one tells a different story. So, which one actually matters? Well…it depends. In this week’s newsletter, Vieje Piauwasdy dives into how different valuations come into play during events like exercising, selling in a tender offer, or preparing for an IPO—and how our new 𝗣𝗿𝗶𝘃𝗮𝘁𝗲 𝗠𝗮𝗿𝗸𝗲𝘁 𝗜𝗻𝘀𝗶𝗴𝗵𝘁𝘀 feature, powered by Caplight, can help you compare them all in one place. 📩 Read the full breakdown below:

𝗔𝗿𝗲 𝘆𝗼𝘂𝗿 𝗰𝗼𝗺𝗺𝗶𝘀𝘀𝗶𝗼𝗻𝘀 𝗮𝗻𝗱 𝗯𝗼𝗻𝘂𝘀𝗲𝘀 𝘁𝗮𝘅𝗲𝗱 𝗮𝘁 𝗮 𝗱𝗶𝗳𝗳𝗲𝗿𝗲𝗻𝘁 𝗿𝗮𝘁𝗲 𝘁𝗵𝗮𝗻 𝘆𝗼𝘂𝗿 𝘀𝗮𝗹𝗮𝗿𝘆?   If you receive commissions or bonuses, you might have noticed that the taxes withheld don’t always match your paycheck’s tax rate. That’s because there’s a difference between taxes withheld and taxes owed—and understanding that difference can help you avoid surprises come tax season. • 𝗧𝗮𝘅𝗲𝘀 𝘄𝗶𝘁𝗵𝗵𝗲𝗹𝗱: The amount of taxes that are withheld by your employer, which may not necessarily cover all of the taxes that you owe.  • 𝗧𝗮𝘅𝗲𝘀 𝗼𝘄𝗲𝗱: The actual amount of taxes that you owe based on your personal income tax bracket.        📌 𝗛𝗼𝘄 𝗮𝗿𝗲 𝗰𝗼𝗺𝗺𝗶𝘀𝘀𝗶𝗼𝗻𝘀 𝗮𝗻𝗱 𝗯𝗼𝗻𝘂𝘀𝗲𝘀 𝘁𝗮𝘅𝗲𝗱? • The IRS considers them “supplemental income,” which is subject to a default 22% federal withholding rate. • If your tax bracket is higher than 22%, your employer’s withholding may not cover what you actually owe—meaning you could owe more at tax time. • If your tax bracket is lower than 22%, you may have had too much withheld and could get a refund when filing. 📢 𝗪𝗮𝘁𝗰𝗵 𝗼𝘂𝘁 𝗳𝗼𝗿 𝘂𝗻𝗱𝗲𝗿-𝘄𝗶𝘁𝗵𝗵𝗼𝗹𝗱𝗶𝗻𝗴 If your employer isn’t withholding enough, you could face an unexpected tax bill—or even penalties. To avoid this, you can: ✅ Make estimated tax payments throughout the year ✅ Adjust your withholdings to better match your total income ✅ Work with a tax professional to run a tax projection and plan ahead Do you receive commissions or bonuses as part of your compensation? How do you plan for the taxes owed? 👇 Drop your thoughts or questions in the comments.   Disclaimer: This is meant to be general tax advice. Please consult your tax advisor regarding your particular circumstance.      

𝗜𝗻𝘁𝗿𝗼𝗱𝘂𝗰𝗶𝗻𝗴: 𝗣𝗿𝗶𝘃𝗮𝘁𝗲 𝗠𝗮𝗿𝗸𝗲𝘁 𝗜𝗻𝘀𝗶𝗴𝗵𝘁𝘀. A clearer picture of your equity. Understanding what your private stock is worth isn’t always easy. Unlike public stocks, private companies can have multiple valuations—each telling a different story. That’s why we’ve partnered with Caplight to bring Private Market Insights to the Secfi platform. Now, instead of relying on a single number, you’ll see multiple valuation data points side by side, helping you make more informed equity decisions. 📌 𝗪𝗵𝗮𝘁 𝘁𝗵𝗶𝘀 𝗺𝗲𝗮𝗻𝘀 𝗳𝗼𝗿 𝗦𝗲𝗰𝗳𝗶 𝘂𝘀𝗲𝗿𝘀:  📈 Compare different valuation methods – See how different pricing models shape your stock’s worth. 🧠 Better insights, smarter decisions – Understand how your stock is perceived by different market participants. 💪 More transparency, more control – Have the data you need to plan your next move—whether that’s holding, exercising, or selling. With Secfi Private Market Insights, you now have access to the same valuation insights used by top investors and investment banks. 𝗧𝗿𝘆 𝗶𝘁 𝘁𝗼𝗱𝗮𝘆: https://lnkd.in/eYC27yZn

💰 𝗪𝗵𝗮𝘁 𝗵𝗮𝗽𝗽𝗲𝗻𝘀 𝘁𝗼 𝘆𝗼𝘂𝗿 𝘀𝘁𝗼𝗰𝗸 𝗼𝗽𝘁𝗶𝗼𝗻𝘀 𝗶𝗳 𝘆𝗼𝘂 𝗹𝗲𝗮𝘃𝗲 𝘆𝗼𝘂𝗿 𝗰𝗼𝗺𝗽𝗮𝗻𝘆? Thinking about a new job? Worried about layoffs? Deciding to take a break? If you have stock options, leaving your company means making a big financial decision—fast. Most companies give you just 𝟵𝟬 𝗱𝗮𝘆𝘀 to exercise your options after leaving. If you don’t act, your unexercised options expire, and you lose them forever. 𝗦𝗼, 𝘄𝗵𝗮𝘁 𝘀𝗵𝗼𝘂𝗹𝗱 𝘆𝗼𝘂 𝗰𝗼𝗻𝘀𝗶𝗱𝗲𝗿 𝗯𝗲𝗳𝗼𝗿𝗲 𝘆𝗼𝘂𝗿 𝘄𝗶𝗻𝗱𝗼𝘄 𝗰𝗹𝗼𝘀𝗲𝘀? 📌 Key questions to ask: • How much will it cost to exercise my options? (Including taxes 💸) • Do I have enough cash to afford it? • What happens if I do nothing? • What financing options do I have to avoid tying up my savings? 💡 Need liquidity to exercise? Non-recourse financing can help you exercise your stock options without risking your personal cash. Leaving your job doesn’t have to mean leaving money on the table. Have questions? Drop them in the comments—we’d love to help! 👇

𝗗𝗼 𝘆𝗼𝘂 𝗵𝗮𝘃𝗲 𝘁𝗼 𝗽𝗮𝘆 𝘁𝗮𝘅𝗲𝘀 𝘄𝗵𝗲𝗻 𝗲𝘅𝗲𝗿𝗰𝗶𝘀𝗶𝗻𝗴 (𝗮𝗻𝗱 𝘀𝗲𝗹𝗹𝗶𝗻𝗴) 𝗜𝗦𝗢𝘀?   With incentive stock options (ISOs), taxes can come into play at both exercise and sale—but not always. It depends on your income, timing, and whether the alternative minimum tax (AMT) applies. Here’s a breakdown: 📌 𝗔𝘁 𝘁𝗵𝗲 𝘁𝗶𝗺𝗲 𝗼𝗳 𝗲𝘅𝗲𝗿𝗰𝗶𝘀𝗲: → No ordinary income tax—unlike non-qualified stock options (NSOs), ISOs aren’t taxed as income when exercised. → AMT may apply—the spread between your exercise price and the fair market value (FMV) at exercise is considered for AMT purposes, potentially triggering a tax bill even if you don’t sell. 📌 𝗔𝘁 𝘁𝗵𝗲 𝘁𝗶𝗺𝗲 𝗼𝗳 𝘀𝗮𝗹𝗲: → Qualifying disposition (held 1 year after exercise & 2 years after grant): Gains are taxed at long-term capital gains rates, typically lower than ordinary income tax. → Disqualifying disposition (sold before meeting the holding period): You’ll 𝗼𝘄𝗲 𝗼𝗿𝗱𝗶𝗻𝗮𝗿𝘆 𝗶𝗻𝗰𝗼𝗺𝗲 𝘁𝗮𝘅 on the spread at exercise + 𝗰𝗮𝗽𝗶𝘁𝗮𝗹 𝗴𝗮𝗶𝗻𝘀 𝘁𝗮𝘅 on any additional appreciation. 💡 𝗞𝗲𝘆 𝘁𝗮𝗸𝗲𝗮𝘄𝗮𝘆: While you don’t pay ordinary income tax at exercise, AMT can be a factor. It's a good idea to consult with a tax advisor who can help you navigate the specifics of ISOs, especially to assess whether you’ll be subject to AMT and how to plan for it. Do you have ISOs that you are considering exercising or selling? Have you recently exercised or sold ISOs? Drop your thoughts or questions in the comments.   Disclaimer: This is meant to be general tax advice. Please consult your tax advisor regarding your particular circumstance.      #StockOptions #EquityCompensation #TaxPlanning #IncentiveStockOptions #WealthManagement

RSU withholding rate...22% or 37%?  The default withholding rate for RSUs is 22% on the Federal level. However, some companies will allow you to adjust the withholding rate to be higher based on your personal tax situation. As a safeguard, some individuals will elect to have 37% withholding on RSUs (currently the highest Federal tax rate) to avoid any tax penalties or the need to make estimated payments. But deciding between 22% or 37% withholding on your RSUs is a decision that should be based on your personal situation.  📌 Reasons you might withhold 22% → You're willing to gamble more on the stock's upside, despite the higher risk of loss.  → You're comfortable with concentrated exposure to your company's stock.  → You have a healthy cash reserve to pay potential tax bills.   → You’re in a federal marginal tax bracket lower than 22%.    📌 Reasons you might withhold 37% → You are looking to minimize risk by quickly diversifying out of the stock. → You want to avoid potential future pain if the stock price decreases.  → You don’t have a healthy cash reserve to pay potential tax bills.  → You’re in a federal marginal tax bracket above 22%.  💡 Something to keep in mind: If you continue working at your company, you may continue receiving RSUs as part of your overall annual compensation. That said, if you elect a higher withholding rate (or even sell all of your RSUs as they vest), you will still have the opportunity to financially benefit from your company's stock price increasing as subsequent RSUs vest.   Does your company allow you to choose your RSU withholding rate? What withholding rate did you choose? Drop your thoughts or questions in the comments. Disclaimer: This is meant to be general tax advice. Please consult your tax advisor regarding your particular circumstance.

Not all investment metrics are as straightforward as they seem. Some are just marketing spin, and others can be outright misleading. From price return vs. total return to benchmark tricks and hidden tax implications, here are a few common industry “gotchas” to watch for. Read the full breakdown below, and be sure to subscribe to get insights like these in your inbox! 📩 : https://lnkd.in/dQGHsSnv

Let's talk about how to recover AMT paid on exercising your ISOs Exercising Incentive Stock Options (ISOs) can offer significant tax advantages, but it can also trigger Alternative Minimum Tax (AMT), even if you don’t sell your shares. When you exercise ISOs, the difference between the exercise price and the fair market value (FMV) of the stock is included in the calculation of AMT income, which can create a tax burden even if you don’t sell the shares. However, if you paid AMT as a result of exercising your ISOs, there are ways you can recover or offset this tax in future years. Here's how: 📌 AMT Credit The AMT credit allows you to reduce your future tax liability by the amount of AMT you previously paid. Essentially, the IRS treats the AMT tax as a “credit” that you can apply against your regular tax liability. You can use the credit to offset your regular income tax in future years when your regular tax liability exceeds your AMT liability. 📌 Filing Form 8801 To claim the credit, file IRS Form 8801 – Credit for Prior Year Minimum Tax when you submit your tax return. This form calculates how much of your AMT credit you can carry forward to offset taxes in future years. Each year you file, you can carry forward any unused AMT credit from previous years. Tracking this credit is key to optimizing your tax situation. Consult a Tax Professional AMT can be complicated—especially if you’ve exercised a large number of ISOs or have multiple years of AMT to recover. A tax professional can help you: ✔️ Navigate the AMT credit process ✔️ Optimize your tax strategy ✔️ Ensure timely sales of ISO shares to manage future tax implications 💬 Have you paid AMT on ISOs before? Are you planning an exercise that could trigger AMT? Drop your thoughts or questions in the comments. Disclaimer: This is meant to be general tax advice. Please consult your tax advisor regarding your particular circumstance.       

Curious how to avoid paying tax penalties? The IRS expects taxes to be paid in the quarter income is received. If you don’t make estimated tax payments or adjust your withholdings, you could face penalties. But don’t worry…if the estimated tax payment deadline for that quarter has already passed, you may still have the opportunity to avoid paying penalties by adjusting your withholdings.      📌 Common income events that may require estimated tax payments: →Exercising stock options →Vesting Restricted Stock Units (RSUs) →Receiving commissions or a performance bonus →Selling investments at a gain If your tax withholdings aren’t enough to cover your projected tax liability, you may be hit with penalties—currently 7% interest on unpaid taxes. 💡 To avoid paying penalties, taxpayers must satisfy the IRS Safe Harbor. To do so, you must meet the LOWER of these two requirements: ✅ Pay 90% of your current year’s tax liability ✅ Pay 110% of your previous year’s tax liability The good news? The IRS views tax withholding through payroll as evenly distributed throughout the year—even if you adjust it later (like in Q4). If you're concerned that you may have not withheld enough taxes or made timely estimated tax payments, all hope is not lost. That’s why it’s important throughout the year to review if you are "on track" from a tax perspective and make changes to avoid penalties or surprises next tax season.    💬 Do you make estimated tax payments, adjust withholdings, or both? Let us know in the comments. Disclaimer: This is meant to be general tax advice. Please consult your tax advisor regarding your particular circumstance.