Checklist · 3 min read
Leaving your job with equity
Leaving a job starts deadlines on your equity that are easy to miss with a new role starting. A short checklist before your last day can protect options you have already earned and avoid surprises on your final paychecks.
- Who it fits
- Anyone changing jobs while holding options, RSUs or ESPP shares.
- Figures
- 2026 tax year
The key rule
Most option plans give you 90 days after you leave to exercise vested options. ISOs not exercised within three months of leaving lose ISO status and are taxed as NSOs.
How it works
What happens to each type of equity when you leave:
- Unvested RSUs and options: usually forfeited on your last day.
- Vested options: you keep the right to exercise until the post-termination deadline.
- Vested shares: yours to keep.
- ESPP: contributions for the current period are usually refunded, unless a purchase happens before you leave.
7 steps
Download everything before your last day
Grant agreements, vest history, exercise confirmations and tax statements. Access to your equity portal often ends when you leave.
Find your exercise deadline
Read the post-termination exercise period in your plan. Many companies give 90 days; some give years. Put the exact date on your calendar.
Decide which options to exercise
Weigh the cost to exercise, the tax and your view of the company's future. For private companies, ask for the latest 409A value and whether secondary sales are possible.
Check upcoming vests
If a vest falls a few days after your planned last day, it may be worth adjusting the date.
Review your final paychecks
Final vests, ESPP refunds, unused vacation and severance are often withheld at supplemental rates. Confirm the amounts.
Plan your old 401(k)
You can leave it, roll it into your new employer's plan or roll it into an IRA. An IRA rollover can complicate future backdoor Roth contributions, so talk to us first.
Watch the 401(k) limit across employers
Your $24,500 employee deferral limit for 2026 is shared across all employers for the year. Tell your new employer's plan what you have already contributed.
Common mistakes
- Letting the exercise deadline pass. Unexercised options are gone.
- Exercising ISOs after three months and still assuming ISO treatment.
- Over-contributing to 401(k)s across two employers.
Key dates
- Last day
- Unvested equity usually forfeited; the exercise clock starts.
- Three months later
- ISO status ends for unexercised options.
- 90 days later (typical)
- Most option exercise deadlines.
Questions we hear
Will I get excess Social Security tax back?
Yes. If two employers together withheld Social Security on more than $184,500 of wages in 2026, the excess is credited when you file.
What to send us
- Equity statements downloaded before you leave
- Final pay stub
- Your new offer letter, if it includes equity
Upload them to your client portal.
General education for TaxSquad clients, not advice for your situation. Rules and figures change. Talk to us before acting on this guide.