Thread regarding Honeywell International Inc. layoffs

@1nbw is correct. The Fidelity Honeywell Common Stock Fund invests primarily in the common stock of Honeywell. The key word is "Fund" and you do not actually own shares of Honeywell stock. You own "equivalent shares" based on your investment amount divided by they daily closing value of those shares on the Fidelity site. Capital gains tax treatment does not apply to this investment if you chose to cash it out to a taxable account and it will be taxed as ordinary income. You can move the HON stock fund investment to any of the other Fidelity funds with no tax consequences.

I have a mole that changed color and won't stop bleeding. Does anyone know if I should be worried?

You don't actually own HON stock in your 401K. It is money in a fund unique to honeywell's 401k plan that reflects the value of HON stock. No stock trade rules apply. Only 401k rules. If you cash it out you'll pay regular income tax plus a penalty if under 59 1/2 years of age. You can roll into a rollover IRA no tax no penalty.

"Never keep your company stock in your 401k. If they have hard times, you get laid off and your retirement is hosed. My friends at American Airlines are learning thus lesson now."

Enron 2001/2002 taught everybody that lesson, for those who were around then, and paying attention. Thanks for the reminder though!

So the Honeywell stock funds don't fall under this criteria?

Net unrealized appreciation (NUA) is the difference between the original cost basis and current market value of shares of employer stock. The IRS offers a provision that allows for a more favorable capital gains tax rate on the NUA of employer stock upon distribution, after certain qualifying events.

When you transfer most types of assets from a 401(k) plan to a taxable account, you pay income tax on their market value. But with company stock, you pay income tax only on the stock’s cost basis—not on the amount it gained since you bought it. (If you are under age 59½, you may also pay a 10% early withdrawal penalty.)

When you sell your shares, you’ll pay long-term capital gains tax on the stock's NUA. The maximum federal capital gains tax rate is currently 20%, far lower than the 37% top income tax rate, so your potential tax savings may be substantial.

Never keep your company stock in your 401k. If they have hard times, you get laid off and your retirement is hosed. My friends at American Airlines are learning thus lesson now.

Just sell the stock and buy an index fund within the 401k. No need to move it out.

If you are fully vested, the HON stock in your Fidelity 401k account is nothing special and can be moved into the other Fidelity accounts at any time with no penalty. If you were recently layed off you can leave your fund with Fidelity. I left several years ago and still have my 401k with them. If you move money to a taxable account you have to pay ordinary income tax on the proceeds.