Concentrated in Company Stock? Here are 4 Year-End Tax Moves to Consider Now

For many executives, the end of the year brings a perfect storm of financial events. RSU vesting, option exercises, and year-end bonuses often converge just as markets can become increasingly volatile. If much of your net worth is tied up in your company’s stock, these events can create unexpected liquidity gaps, surprise tax bills, and concentrated risk exposure at precisely the wrong time.

While the end of the year doesn’t change your equity position, it does mark a hard deadline for many tax strategies. After December 31, some opportunities disappear, and others become less effective.

For those with significant concentrated equity, taking action before the deadline can reduce tax exposure and strengthen their overall financial position heading into the new year.

The Hidden Risks of Equity Concentration

Professionals with concentrated stock positions face a unique mix of risks as December approaches:

• Volatility risk: A sudden market downturn can erode millions in value just before you planned to act.
• Tax drag: Unplanned RSU or option vesting can trigger ordinary income taxes at the highest marginal rates.
• Opportunity cost: Failing to plan before Dec 31 means missing tax-advantaged moves that can’t be retroactively applied in January.

The following year-end strategies are most relevant if your company’s stock is publicly traded and your net worth exceeds $2 million. If that’s you, thoughtful planning can shift outcomes from reactive to strategic.

Year-end is often the most advantageous time to strategically sell company stock—when timing, tax rules, and income planning intersect.

Harvesting Gains and Losses

By harvesting investment losses, you can offset other realized investment gains and possibly  reduce taxable income for the year. This can be particularly powerful if current federal capital gains rates and/or state tax rates are higher than expected future rates,.

That said, remember the golden rule:

“Don’t let the tax tail wag the investment dog.” Investment fundamentals should drive the decision, with taxes playing a supporting role, not the other way around.

Managing AMT Risk for ISOs

Incentive stock options (ISOs) can trigger alternative minimum tax (AMT) surprises if exercised late in the year. For those exercising ISOs, the timing of exercises can significantly affect AMT liability. Spreading exercises over multiple calendar years can reduce or avoid crossing AMT thresholds, smoothing tax exposure rather than facing a concentrated bill in April.

Smoothing Income Across Years

Large stock sales can push you into higher tax brackets. By spreading transactions between December and January, you may be able to “bracket manage,” lowering your effective tax rate over two tax years.

At Summitry, we integrate these sales with your broader wealth, investing, and estate plans. Tactical tax moves are valuable, but only when they fit into a cohesive long-term strategy.

Rather than selling shares and donating cash, gifting stock directly can unlock multiple layers of tax advantages. When you donate appreciated stock held for more than one year, you can:

• Avoid capital gains tax on the appreciation. If you were to sell the stock first, you’d owe capital gains on the increase in value before donating the net amount. By donating shares directly, you avoid recognizing that gain, and the charity, because it’s tax-exempt—can typically sell the stock without incurring capital gains tax.
• Claim a charitable deduction for the fair market value of the donated stock (subject to IRS limits, typically up to 30% of AGI for appreciated assets). This could reduce your taxable income in the current year.
• Support causes that align with your values while also advancing your financial goals.
• Diversify your portfolio tax-efficiently. Donating stock is effectively a way to reduce exposure without triggering immediate capital gains.

And because charitable gifts must be completed before December 31 to qualify for the current tax year, this can be a smart year-end planning move.

Pro Tip: Beginning in 2026, charitable deductions will be subject to a 0.5% AGI floor. This may make “bunching” gifts into 2025 (e.g., via a donor-advised fund) more tax-advantageous than spreading them out annually or waiting until future years to initiate large gifts. You can learn more about upcoming tax changes in our Big Beautiful Bill Tax Guide.

Giving Vehicles

The right vehicle depends on the size of your gift, your goals, and whether you want to give now, later, or over time. Here are your main choices:

1. Direct Stock Donations

This is the simplest approach: transfer appreciated stock directly to a qualified public charity. You avoid recognizing capital gains, claim a deduction for fair market value, and the charity can sell the shares tax-free. This strategy is best suited for one-time or recurring gifts and must be initiated early enough to settle before December 31.

2. Donor-Advised Funds (DAFs)

DAFs let you donate appreciated stock now, claim an immediate tax deduction, and distribute funds to charities over multiple years, if you choose to. The sponsoring organization handles administration, making it a flexible, low-complexity option. DAFs are ideal if you want the tax benefit now but prefer to decide on charitable recipients over time.

3. Charitable Remainder Unitrusts (CRUTs)

CRUTs are advanced charitable planning tools best suited for higher-net-worth individuals (typically $8M+). By transferring appreciated stock into the trust, the assets can be sold without immediate capital gains, and you receive an income stream for life or a set term. The remainder ultimately goes to charity, and you may qualify for a partial charitable deduction at funding.

This combines philanthropy with tax-efficient income planning.

For many, trading restrictions and blackout periods can complicate selling company stock. A Rule 10b5-1 trading plan prearranges future sales according to a set schedule, creating a safe harbor against insider trading concerns by ensuring the plan is adopted before they hold any material nonpublic information.

Year-end is an ideal time to review or update these plans because executives often have better visibility into vesting schedules, upcoming liquidity needs, and tax projections for the year ahead.

Unlike other strategies that must be executed before December 31, this is primarily a planning step, setting the stage for future action. It’s particularly valuable for executives with ongoing RSU vesting or insider status who want more control and predictability over how their concentrated stock exposure is reduced.

Once the timing of sales is established, the next question becomes how to strategically reinvest and diversify those proceeds.

How you diversify can matter as much as when you do it. Year-end offers a window to structure sales and reinvestments in ways that deliberately align liquidity, taxes, and long-term investment goals.

For Those With $2M–$8M Net Worth

For many in this category, diversification often starts with laddered selling, a deliberate, staged sale of company stock over time to manage both tax exposure and market risk. Proceeds are typically reinvested into a diversified portfolio that’s better aligned with long-term objectives.

Tactics like direct indexing can add flexibility by enabling targeted tax-loss harvesting to offset other gains, while tax-aware asset location helps minimize ongoing tax drag by placing investments in the most efficient accounts.

For Higher-Net-Worth Individuals ($8M+)

At higher net worth levels, more sophisticated strategies can be layered on. Exchange funds allow shareholders to contribute their concentrated stock to a pooled investment vehicle in exchange for a diversified portfolio, achieving diversification without triggering immediate capital gains.

Charitable remainder trusts (CRUTs) offer another path: appreciated stock is transferred to the trust, sold without immediate capital gains, and used to fund an income stream for the donor, with the remainder going to charity. This can address both liquidity and legacy planning goals in a tax-efficient way.

Regardless of strategy, the goal remains the same: reduce single-stock risk, increase flexibility, and ensure your equity works in service of your long-term plan—not the other way around.

Year-end planning can be the difference between a reactive tax scramble and a strategic wealth transformation. By addressing concentrated equity risk before Dec 31, you can:

• Reduce unnecessary taxes,
• Diversify thoughtfully, and
• Position yourself for financial freedom in the years ahead.

You don’t have to navigate this alone.

Summitry specializes in guiding executives through equity compensation complexities, wealth management, and tax-smart investment strategies so your hard-earned stock becomes a tool for building the future you want.

Act now. Most year-end moves require initiation well before December 31 to count.