Restricted stock refers to unregistered shares of ownership in a corporation that are issued to corporate affiliates, such as executives and directors. Restricted stock is non-transferable and must be traded in compliance with special Securities and Exchange Commission (SEC) regulations.

Where does restricted stock come from?

A restricted stock unit (RSU) is a form of compensation issued by an employer to an employee in the form of company shares.

Restricted stock is a form of compensation issued by a corporation to executives that are unregistered shares of ownership in the company. Restricted stock is untransferable and becomes available to the employee after some conditions are met, often time related and governed by a vesting schedule.

Can I sell restricted stock?

Restricted stock units (RSUs) are a form of stock-based employee compensation. RSUs are restricted during a vesting period that may last several years, during which time they cannot be sold. Once vested, the RSUs are just like any other shares of company stock.

When do restricted stock units become unrestricted?

These shares may also come with a double-trigger provision. That means that an employee’s shares become unrestricted if the company is acquired by another and the employee is fired in the restructuring that follows. Two variations on restricted stock are restricted stock units (RSUs) and restricted stock awards.

What makes restricted stock a non transferable stock?

Restricted stock is non-transferable and must be traded in compliance with special Securities and Exchange Commission (SEC) regulations. The restrictions are intended to deter premature selling that might adversely affect the company.

What’s the difference between restricted stock and restricted stock awards?

Restricted Stock Units vs. Restricted Stock Awards. Two variations of restricted stock are restricted stock units (RSUs) and restricted stock awards. A restricted stock unit is a promise made to an employee by an employer to grant a given number of shares of the company’s stock to the employee at a predetermined time in the future.

Do you have to report restricted stock in Australia?

The employer is required to report income received by an employee from restricted stock and RSUs to both the employee and the Australian tax authority, and the employee is required to report such income on his or her annual tax return.