If so, you might benefit from net unrealized appreciation (nua) on your taxes The nua is the difference between what. It’s equal to the difference between the stock’s initial purchase price (cost basis) and its value when distributed to the employee. Irs rules for net unrealized appreciation (nua) from 401 (k) and esop plans, and why nua distributions aren't always a great deal. Net unrealized appreciation (nua) tax treatment refers to the taxation of gains on employer stock within a retirement plan when the stock is moved to a taxable account or distributed as a lump sum. This appreciation has yet to be realized or taxed, as the stock has not sold.
Generally, after a lump sum distribution from the plan, the nua tactic enables an eligible person to pay long term capital gains (ltcg) tax on the growth of company stock that occurred while the stock was in the plan. This strategy may offer significant tax savings on those assets.
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