IPO Lockup Tax Planning Calculator 2026
IPO lockups typically expire 180 days post-IPO. Selling all shares at once can push you into 37% federal + 13% CA state + 3.8% NIIT + AMT — total 50%+. Selling over 12-24 months using tax-bracket-fill strategy can save 5-15% of total proceeds. This tool models the trade-off.
Why Spreading Sales Saves Tax
LTCG rate jumps from 15% to 20% at $518K joint AGI (2026). Selling $5M at once = all $5M at 20% federal. Selling $1.25M/year over 4 years = much stays in 15% bracket. Add NIIT (3.8% above $250K AGI single / $400K joint) and state tax (CA 13.3%), and the savings compound.
Lockup Expiration Strategy
Most IPO lockups: 180 days post-IPO. First-time sale window: 4 quarters/year if you're not insider. Insiders use 10b5-1 trading plan to schedule sales 6+ months in advance (defends against insider-trading allegations). Plan typically sells 25% per quarter starting 7 months post-lockup.
AMT and ISO Tax Trap
If shares are from ISOs and were not previously exercised, AMT applies at exercise (not sale). For RSUs, ordinary income tax at vesting + capital gains tax on appreciation between vest and sale. Plan exercise timing for ISOs around AMT brackets to minimize exposure.
Source: IRS Topic No. 409 (Capital Gains), SEC Rule 144, IRS Form 6251 (AMT). Last updated: May 2026.