Company stock held in a 401(k) plan enjoys a special tax benefit called "Net Unrealized Appreciation" (NUA), which allows employees, upon leaving or retiring, to have the appreciated portion of the stock taxed at the long-term capital gains tax rate of up to 20%, rather than the ordinary income tax rate of up to 37%. However, transferring these stocks into an Individual Retirement Account (IRA) will permanently forfeit this tax benefit.