[Cerium]

You won't get underwater from a vested stock that crashed; the company bears the responsibility of selling enough shares at the time of vest to cover all the taxes- that said you can end up paying a huge sum in taxes and getting no cash from the deal if it crashes before you sell your half.

You can get in real trouble with options of non-public companies and with ESPP plans. Stock from an ESPP plan, if sold in the first 12 or 18 months of holding (depending on the plan details) will be reported as ordinary income at the time of purchase. If you sell during that 12-18 month period at a loss you will still owe taxes at the full price, and that can get you in a hole. I've heard of people owing 20k taxes on a 5k return because of a panic sell during a market downturn.

I'm just an engineer and not a tax professional, so there may be errors in what I've stated.