After purchasing restricted stock in a company, so that the amount paid for the stock is exactly equal to its fair market value at the time of purchase, can you file an 83b election at that time? If so, does this mean you pay no taxes at the time of purchase?
In the explanations I have found, 83b is explained as a means to identify restricted shares as income at the time of purchase to help protect against the need to pay taxes on the difference in future value of the stock and the value at the time of grant.
In the extreme case, being given restricted stock at no price, one would need to pay taxes on the full fair market value if filing the 83b immediately. Or else pay taxes on the realized fair market value at the time the stock is vested.
But in the other extreme case, when you pay the full fair market price for the shares up front, does this mean that with an 83b election there is no tax liability at all (since there is zero difference between the amount paid and the fair market value at time of grant)?
If so, what happens in this case if the value of the shares rises before the vesting period ends? Normally the 83b protects the investor from needed to pay taxes at that point (unless she elects to sell the shares). Is that the same if the shares were originally purchased at fair market value rather than below market value?