Net Unrealized Appreciation (NUA) Calculator

Compare NUA strategy vs IRA rollover for employer stock. See LTCG vs ordinary income tax savings.
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NUA Amount

$75,000.00

Tax Savings (NUA vs IRA)

$12,750.00

Savings Percentage

39.84%

NUA Strategy

Total Cost Basis$25,000.00
Total Market Value$100,000.00
Net Unrealized Appreciation$75,000.00
Tax Now (basis @ 32%)$8,000.00
Tax Later (NUA @ 15% LTCG)$11,250.00
Total Tax — NUA Strategy$19,250.00

IRA Rollover Comparison

Total Tax — IRA Rollover (all @ 32%)$32,000.00
Total Tax — NUA Strategy$19,250.00
Tax Savings with NUA$12,750.00

Use the Net Unrealized Appreciation (NUA) Calculator above to calculate your results. Enter your values and see instant results — all calculations run in your browser.

Disclaimer: This calculator is for informational purposes only and does not constitute tax, financial, or legal advice. Results are estimates based on the information you provide and current rates. Always consult a qualified tax professional or financial advisor for advice specific to your situation.

How It Works

A Net Unrealized Appreciation (NUA) Calculator helps employees with company stock in their 401(k) determine potential tax savings when retiring or separating from service. This strategy allows you to pay ordinary income tax only on the original cost basis of company stock, while the appreciation is taxed at capital gains rates when sold.

The calculation compares two scenarios: rolling all assets to an IRA versus using NUA treatment for company stock. For NUA, you pay ordinary income tax on the stock's cost basis immediately, then capital gains tax on the appreciation when sold. The remaining 401(k) assets can be rolled to an IRA tax-free.

NUA treatment is only available for company stock and requires a qualifying triggering event like retirement or job separation. You must take a complete distribution of your entire 401(k) balance within one tax year to qualify. Consider your current tax bracket, expected future tax rates, and the time horizon for selling the stock.

Employee with $200,000 Company Stock ($50,000 Cost Basis)

  1. 1 John has $200,000 in company stock with a $50,000 cost basis and $300,000 in other 401(k) assets, totaling $500,000. He's in the 24% tax bracket and faces 15% long-term capital gains rates.
  2. 2 Using NUA: Immediate tax on $50,000 cost basis = $50,000 × 24% = $12,000. Future capital gains tax on $150,000 appreciation = $150,000 × 15% = $22,500. Total tax = $34,500.
  3. 3 IRA rollover alternative: All $200,000 taxed as ordinary income when withdrawn = $200,000 × 24% = $48,000 in taxes.
  4. 4 NUA strategy saves $13,500 ($48,000 - $34,500) compared to IRA rollover. The $300,000 in other assets rolls to an IRA tax-free, and John gains flexibility to time the stock sale for optimal tax treatment.

Source: IRS — Forms, Instructions & Publications · Last updated: April 2026

Frequently Asked Questions

What is the NUA tax strategy?
Net Unrealized Appreciation lets you transfer employer stock from a 401(k) to a taxable brokerage account, paying ordinary income tax only on the cost basis. The appreciation (NUA) is taxed at the long-term capital gains rate (0-20%) when sold, instead of ordinary income rates (up to 37%).
When does NUA make sense?
NUA is most beneficial when the stock has significant appreciation (NUA is large relative to cost basis), you are in a high tax bracket, and you plan to hold the stock. If the cost basis is 20% of the current value, you pay ordinary tax on just 20% and capital gains on 80%.
What are the risks of the NUA strategy?
The main risks are concentration risk (holding too much in one stock), the requirement to take a lump-sum distribution of the entire 401(k) in one calendar year, and paying immediate ordinary income tax on the cost basis portion. If the stock declines after distribution, you may lose more than the tax savings.

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