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Year-End Tax Considerations for GE Executives Thumbnail

Year-End Tax Considerations for GE Executives

Insights

By Matt Held, CFP®

December is an ideal time to review year-end tax considerations. For many GE executives, two of the most important considerations are restricted stock units (RSUs) and tax withholding.

When working with each client, we take the time to craft an individualized plan. Here, we outline some general tips for your review of year-end tax considerations.

Restricted Stock Unit (RSU) Basics for Executives

RSUs are a common kind of equity compensation among executives at GE Aerospace and elsewhere. An RSU is a promise of future stock offered to incentivize you to stay with the company long-term. This is a brief overview of how they work:

  • Your company grants you RSUs.
  • The RSUs follow a vesting schedule with specific time frames. (For GE-specific RSUs, the vesting schedule is 50% on the 2nd anniversary and 50% on the 3rd anniversary.) 
  • Once vesting conditions are met, you receive the actual shares of the stock.

You won’t be taxed on RSUs immediately after they are granted. However, once the shares officially vest, you pay taxes on their fair market value, just as you would if you received a bonus. RSUs are reported on your W-2 and taxed as ordinary income.

RSUs tend to vest after two to five years. Over that timeline, it’s easy to forget the exact vesting schedule. If you do, you could face an unexpectedly large tax bill. You can sell the shares, which means paying capital gains tax on any post-vesting appreciation.

Reviewing your RSU vesting schedule is one of the most important year-end tax considerations for executives. If you find that shares have vested sooner than you thought, you still have time to adjust your tax strategy.

Reviewing Your Tax Withholding

For executives, tax withholding can be extraordinarily complex. This is largely because some types of executive compensation are taxed outside of the typical payroll cycle. Some common ones include:

  • RSUs
  • Stock options
  • Bonuses

Reviewing your withholdings is one of the most critical year-end tax considerations. If you’re like many of our clients, you make quarterly estimated tax payments to cover the tax liabilities that come with equity compensation. 

However, if you want to optimize your cash flow, you must look carefully at your combined withholding and estimated tax payments. If you’re overwithholding or overpaying, you’re giving the government an interest-free loan. Conversely, underwithholding or underpaying could result in unexpected penalties.

This is one of the year-end tax considerations my clients most commonly ask for help with. I can help you create a plan to review your withholding throughout the year.

Year-End Tax Planning Opportunities

When it comes to year-end tax considerations, you shouldn’t miss any opportunities to save. It’s best to coordinate with your financial advisor before making any decisions, but these are three of the most common year-end tax considerations our clients revisit.

Retirement Contributions

Before the end of the year, verify you have maxed out your retirement plan contributions.

Charitable Giving

Consider taking advantage of the tax deductions that come with establishing donor-advised funds (DAFs), gifting appreciated securities, and otherwise supporting charities.

Income Timing

Non-qualified deferred compensation (NQDC) plans and other types of deferred compensation might be worth exploring because of their ability to lower your tax liability.

Need Help With Year-End Tax Considerations?

We know the end of the year can get very busy, but don’t neglect your year-end tax considerations. Check your RSU vesting schedules and your tax withholding now. If you do, there may be time to make important changes before tax day. 

Clarity Wealth Management is here to help you interpret your executive compensation package while making your money work for you. We combine local, owner-advisor skills with the resources of Commonwealth Financial Network. With decades of experience guiding executives through every stage of their financial journey, we provide strategic, personalized advice you can rely on for the long term.

If you want to learn more, contact us. Interested in a no-obligation, icebreaker call? Schedule online here, call (513) 278-9420, or email Info@ClarityWealth.org.

Frequently Asked Questions

1. What year-end tax considerations are most important for GE executives?

Two of the most critical year-end tax considerations for GE executives are reviewing restricted stock unit (RSU) vesting schedules and evaluating tax withholding. Both can significantly affect your total tax liability and help you avoid unexpected bills or penalties.

2. Why should I review my RSU vesting schedule as part of my year-end tax considerations?

RSUs are taxed as ordinary income when they vest, and if you lose track of the vesting schedule, you could face a larger tax bill than expected. Reviewing your vesting dates is one of the most essential year-end tax considerations because it gives you time to adjust your strategy or plan for the tax impact.

3. How does tax withholding factor into year-end tax considerations for executives?

Executive compensation such as RSUs, bonuses, and stock options may be taxed outside the regular payroll cycle, making withholding more complex. As part of your year-end tax considerations, reviewing your combined withholding and estimated payments helps prevent you from overpaying or underpaying—both of which can affect your cash flow or lead to penalties.

About Matt

Matt Held, CFP®, is the lead advisor and a founding partner of Clarity Wealth Management, a boutique firm based in Cincinnati, OH. Since entering the industry in 2006, Matt has helped corporate executives, professionals, and business owners uncover opportunities and build long-term financial strategies. Driven by a desire to control his own future and create a lasting brand, Matt co-founded Clarity Wealth Management in 2012. His mission was to build a firm that would provide truly personalized guidance—and become a legacy for his own family. Today, Clarity serves about 100 households and focuses on helping clients simplify and navigate complex financial decisions, particularly those involving equity compensation, tax planning, and executive retirement.

Matt’s approach is rooted in trust, loyalty, and hard work. As a CERTIFIED FINANCIAL PLANNER® professional, he is deeply committed to long-term relationships and believes that clarity doesn’t mean predicting the future, but having the confidence that your plan can handle whatever comes your way.

Outside of work, Matt enjoys time with his wife, Abby, and their twins, Henry and Kinsley. Whether it’s watching sports (they love their Ohio State Buckeyes), hitting the slopes out West, or squeezing in a workout, he’s passionate about staying active and present. He’s also a proud graduate of Moeller High School and The Ohio State University. Matt holds Series 7 and 66 licenses, is licensed for health insurance, and earned his CFP® certification in 2012. He has been named a Five Star Wealth Manager in the Cincinnati area since 2013.* To learn more about Matt, connect with him on LinkedIn. 

*2013-2018 and 2020-2024 Five Star Wealth Manager Award, created by Five Star Professional. The 2024 award was presented in September 2024 based on data gathered within 12 months preceding the issue date. Advisors pay a fee to hold out marketing materials. Not indicative of advisor’s future performance. Your experience may vary. For more information, please visit www.fivestarprofessional.com. 

Clarity Wealth Management is neither endorsed by nor affiliated with GE or GE Aerospace.