Doordash, Airbnb, Roblox, Wish, Affirm, and other unicorn companies will go public this year. Employees were granted RSUs or stock options. How much will they make? Stock price after the employee lockup period expires matters a lot.

Example for RSU:

Assume you have 20,000 shares of stocks vested on Uber IPO day. At $45 per share, they are worth $900,000. Uber withholds roughly 40% (22% Federal tax, 10% CA state tax and 8.2% SS/Medicare/etc), so you would be awarded 12000 shares.

Assume your actual federal rate is close to 37%, you would owe IRS $900,000 * (37%-22%) = $135,000. If the stock price goes down to $20 and you have to sell $135,000 / $20 = $6,750 shares to cover federal tax alone.

Now you have $12,000 - 6,750 = $5,250 shares left, with a total value of $105,000 . If you live in California, you must sell more shares to cover the state tax.

Q: Does the holding period for RSU grants for long-term capital gains tax rates start at the issuance of the RSU or at the time the RSU vests?
A: It starts on vesting date. See details on Quora.

Now input your RSU numbers or stock options and calculate the net value and tax due.