Morgan Stanley

Morgan Stanley Smith Barney Adds Retirement Eligibility Tracking and Reporting for Stock Plan Clients

Sep 15, 2011

Automates tracking for corporate clients, creates tax transparency for stock plan participants

New York —


Morgan Stanley Smith Barney announced today that it has added a service to help corporate clients track retirement eligibility dates and collect employment taxes from employees who receive restricted stock units (RSUs) as part of their equity compensation.  Morgan Stanley Smith Barney provides stock plan services to nearly 2.5 million participants at more than 500 corporations globally, including more than 20 percent of the Fortune 500.1

In certain cases, employees who receive RSUs could face unexpected tax consequences when they hit their employer’s “retirement eligible” date.  If the risk of forfeiture on RSUs is eliminated on that date, the RSUs are considered vested, potentially triggering Medicare and Social Security taxes.  As a result, employers must track individual retirement eligibility dates for participants with restricted stock units and collect taxes when due.

“With more companies issuing restricted stock units and a growing portion of the workforce nearing retirement age, adhering to retirement eligibility tax rules is becoming more of an issue for our corporate clients,” said Julian Clark, Head of Global Stock Plan Services at Morgan Stanley Smith Barney.  “Our retirement eligibility service eliminates a lot of manual work for clients and lowers the risk that they might miss a taxable event by automating a complicated tracking process.”

The Firm’s Total Administration system for global stock plans stores employees’ eligibility dates and the amount of shares subject to employment taxes.  Based on this data and the participant’s tax information, Morgan Stanley Smith Barney will calculate the Social Security and Medicare taxes due and show a statement of the information on the participant’s online account.

Morgan Stanley Smith Barney, a global leader in wealth management, provides access to a wide range of products and services to individuals, businesses and institutions, including brokerage and investment advisory services, financial and wealth planning, credit and lending, cash management, annuities and insurance, retirement and trust services.  For further information about Morgan Stanley Smith Barney, please visit

Morgan Stanley (NYSE: MS) is a leading global financial services firm providing a wide range of investment banking, securities, investment management and wealth management services.  The Firm's employees serve clients worldwide including corporations, governments, institutions and individuals from more than 1,300 offices in 42 countries.  For further information about Morgan Stanley, please visit

1 As of 6/30/11.

Investments and services offered through Morgan Stanley Smith Barney LLC, member SIPC.

Morgan Stanley Smith Barney LLC and its affiliates do not provide tax or legal advice. To the extent that this materials or any attachment concerns tax mattes, it is not intended to be used and cannot be used by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Any such taxpayer should seek advice based on the taxpayer’s particular circumstances from an independent tax advisor.

©2011 Morgan Stanley Smith Barney

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