RSU to Corporate Board member - Spidell

RSU to Corporate Board member

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Message Board RSU to Corporate Board member

This topic contains 2 replies, has 2 voices, and was last updated by Laura Rose 2 months, 1 week ago.

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  • #158430
    Laura Rose

    Board member (taxpayer) receives 1099-Misc for services reported on Schedule C. Corporation is based in CA and he does come out to meetings on occasion in CA but does majority of work from home office.  He is a resident of Utah.  He is granted RSU units that vest over the year, in addition to his board fees, that are also included on 1099-Misc (for the vested units).

    For CA taxable income, does he have to treat the RSU amounts included on the 1099 the same as the compensation?  In other guidance, the RSU income would be prorata based on total days worked in CA vs total vesting period, as opposed to sourcing the full amount to CA.  Would this apply to a non-employee?

    Thank you for any help in interpreting the rules…



  • #158563
    Sandy Weiner

    Laura, I believe it would be treated the same as other compensation but you may want to confirm with the FTB’s Ask a Legal Expert.

  • #160428
    Laura Rose

    Thank you – I just sent an email to the FTB.  I believe also that it has to be treated the same as he is a business, not an employee but want to confirm.  The  other question I have is that he is on several corporate boards – only 2 are headquartered in CA (but are Delaware Corporations).  He does attend some meetings in CA but does majority of work from home office (in Utah).  He also mentioned that as a Board member he is working for the shareholders, not under management of Corporation so not sure who is the benefactor in this situation.  Anyone have any good guidance material on what would be considered CA source?

    Another twist is he does own a  2nd home in CA but is in CA less than half the year (not working).  He just moved back to CA due to health reasons end of 2018.