Intel Corp (INTC)

[Windsock]

Each RSU equals 1 share of stock. When the RSU vests the grant holder receives a share of stock for each RSU and the value of the vested stock shares at time of vesting has is subject to earned income tax.

An employee stock option gives the employee the right to buy shares of stock at a grant price when the option vests at some time in the future. The grant price is equal to the stock price when granted.

Typically, options vest over 3 to 5 year. Once an option vests an employee can buy the stock immediately or at a later time before the the option expires. Options typically expire about 5 years after vesting.

An option does not generate income tax liability when it vests. However, when an option is exercised the difference between market price at exercise and the grant price constitutes income for tax purposes whether or not the stock is sold. The stock value at exercise then becomes the basis for the stock when it is later sold