At many banks, starting at the associate level, a portion of your bonus gets paid in stock. I'm curious about how this entire process works and I'm hoping someone can answer some or maybe all of the following questions. Thanks in advance everyone.
- Logistically, how does the process work? Are you issued shares at bonus time, but you just can't sell them until they vest? Or are shares "reserved" for you, but only issued once they vest?
- Are these shares classified as equity grants?
- What is the typical vesting period, 25% each year for 4 years?
- How and when are they taxed? (Income vs cap gains rate, I would assume they are double taxed)
- Similarly, which value are the taxes based on? Grant date, date that they vest, date they are sold, a combination?
- How do dividends work while the shares are unvested? Do they accrue until the shares vest and you get them once they do vest or are you not entitled to dividends until the shares vest?
Anything else that would be useful that I may have missed? Thanks again
