Should you use the NUA strategy for employer stock in your 401(k)? Compare NUA vs. rollover to find the tax-optimal path.
✓ 2026 IRS Data✓ Capital Gains + Ordinary Income
Your 401(k) Stock Details
Fair market value today
What you originally paid / was allocated
Mutual funds, bonds, cash in 401(k)
Tax & Income Information
⚡ NUA Strategy vs. Full Rollover
NUA Strategy
$0
After-tax value at sale
Full Rollover to IRA
$0
After-tax value at withdrawal
Tax Advantage
$0
📊 Tax Breakdown Comparison
NUA Strategy
Full Rollover
📋 How the NUA Strategy Works
Take a lump-sum distribution from your 401(k) in the same tax year (required for NUA eligibility)
Transfer employer stock in-kind to a taxable brokerage account (do NOT sell it inside the 401(k))
Roll the remaining 401(k) assets (mutual funds, bonds, cash) to a Traditional IRA
Pay ordinary income tax only on the stock's cost basis — not the full value
When you sell the stock, pay long-term capital gains on the NUA (appreciation) — regardless of how long you've held it in brokerage
Any additional appreciation after the distribution follows normal capital gains rules (short-term if held <1 year, long-term if held 1+ year)
📈 After-Tax Value Over Time
📋 Year-by-Year Comparison
Year
Age
NUA Value
NUA After Tax
Rollover Value
Rollover After Tax
NUA Advantage
💡 Planning Notes
⚠️ NUA Eligibility Requirements
Triggering Events (one required)
NUA treatment requires a lump-sum distribution from the plan after one of these: separation from service (any age), reaching age 59½, disability (self-employed only), or death of the participant.
Lump-Sum Requirement
The entire 401(k) balance must be distributed in a single tax year. Partial distributions do not qualify. The employer stock goes to a brokerage account; remaining assets can be rolled to an IRA.
This calculator provides estimates based on current tax law and the inputs provided. NUA rules are complex and depend on individual circumstances. Results should not be considered tax advice. Consult a qualified tax professional before implementing an NUA strategy.