Questions tagged [employee-stock-options]

ownership of company given to employee, generally in start-ups instead of giving cash rewards. Also used by listed organisations as a mechanism for employee retentionship

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44 views

Can a company not pay out on ESPP enrollment?

My girlfriend enrolled in her company’s ESPP program beginning Jan 1, 2021. They have been withholding 10% of her gross pay as expected. Now that the July 1 payout has arrived with nothing seen by her ...
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33 views

What does this statement mean in my ESOP?

I am in senior marketing position at my startup and I have been recently granted ESOP. My contract has this written in it: 55,000 options (Shareholder Interests, Options), which represents an ...
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1answer
56 views

Start-up Valuation with employee option pool

I am reading Venture Deals 4th edition and I came across the following statement in a chapter on economic terms of the deal: Consider $5 million investment at $20 million pre-money valuation. Assume ...
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17 views

If I already had taxes withheld, will I get a refund for investing in a Qualified Opportunity Zone (QOZ)?

When I sell any NSO or ISO (long and short term mixed) there are taxes withheld by the company/brokerage. In my understanding, investing in Qualified Opportunity Zones for a long term has benefits in ...
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1answer
45 views

Valuing employee bonus stock options in a startup

Oftentimes, a prospective new employee for a start-up is offered stock options as a significant part of their sign-on bonus, if not the entire bonus. When given an offer, say, of an option for 20,000 ...
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1answer
200 views

Roth IRA and pre-IPO shares

With the recent news that a billionaire managed to get several billion dollars in a Roth IRA by funding it from pre-IPO shares of his company, I'm curious about how this works. Ignore for the moment ...
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3answers
3k views

Company just got acquired. What does this mean for my common stock?

I own 200 common shares of a private company I worked for up until about 3 years ago. Today, I read in the news that they were acquired for a LOT of money but I don't know yet what the current stock ...
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1answer
75 views

Having Stock Options Without Knowing Total 409a Valuation

I have just received some of my first stock options in a company. The paperwork states the FMV of stock, my exercise price, and the total number of shares reserved for employee options. However, I ...
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25 views

AMT and Child Tax Credit

I'm trying to figure out at what point AMT might hurt me, because I just received from stock options from my employer and am considering the benefit of exercising. I worked through form 6251, but I ...
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2answers
293 views

Employee stock options: why is the total number of shares a secret?

I know someone close to me who has been offered employee stock options (which they are supposed to buy later at a fixed price, potentially, when/if the business goes to IPO or something) and they ...
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3answers
183 views

Should I exercise my options to buy stock in a company not yet trading publicly?

I used to work for a start up that offered stock options which I haven't been able to afford to exercise until now. I'm very new to stocks so I'm not 100% sure how it works. Currently, I'm able to ...
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23 views

If the founders and investors all own SAFE notes, how bad is that for common stock option holders?

I'm interested in joining a startup from San Francisco for a modest pay in exchange for 0.75% of equity (stock options). There has been one round valuing the company at $22 million. The serial ...
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2answers
28 views

Assessing the value of stock options without the strike price or cap table

I recently received a job offer that offers me a certain number of stock options, but when I asked for the strike price or cap table they said that they cannot share that information with me. Instead ...
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2answers
160 views

Share Options Vs Salary

In my current role my base salary is well below market value for my experience and responsibility. Ive also been awarded some share options and pay in to a share save scheme at the same time. I have ...
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0answers
175 views

Can a company cancel vested employee stock options on acquisition?

My company stock option plan contains the following language: In the event that the company is subject to an Acquisition, outstanding awards acquired under the plan shall be subject to the agreement ...
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3answers
324 views

Sticky Situation in Negotiation - Should I walk away from contract if I already did the job?

I am in a very sticky situation, I agreed with a customer I'd do a job that takes 1.5 months for 25k$. The customer sells my job artifacts to a very reputable client and adding that client to my ...
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1answer
136 views

Taxes on stock options for non-resident aliens

I have ISO stock options as part of my employment in California, USA. In the middle of 2019 I had to leave the USA for family reasons. In 2020 I wasn’t in the US (became non-resident alien for tax ...
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1answer
30 views

“Price per option granted” versus “exercising price”?

What is the difference between "price per option granted" and "exercise price" ? Let's say I received 10 employee stock options with a "price per option granted" = 0 Euro ...
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2answers
52 views

What to ask for to determine percent of startup I have shares in?

I work at a pre-launch tech startup and we agreed that I'd receive 2% equity. When I signed paperwork for the shares, there was nothing indicating what % I signed at, just the number of shares. I ...
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0answers
28 views

How to think about an options tender offer?

In my previous job I got stock options, even though the company was still private. When I left the job, I paid the company ~$12k to buy these "unborn" stocks (excerzise the options?). Now ...
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30 views

What are the differences between IPO and Direct Listing, esp for employees?

If a pre-IPO company is evaluating whether they should go IPO or Direct Listing, how would either option affect employees? Let's say the employees have some combination of NSO, ISO, RSU. IPO may be a ...
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1answer
64 views

If I have a fixed amount to invest, should I exercise and hold NSOs or ISOs of my company?

I am trying to play some scenarios to compare opportunity costs and hopefully decide on which route, to maximize my gains (after all taxations). I formulated a spreadsheet to help me calculate a few ...
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139 views

Can timing the exercise of stock options based on material non-public information be considered insider trading?

Suppose I strongly expect, based on material non-public information, that a public United States company in which I hold incentive stock options (as a current or former employee) will see an increase ...
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56 views

US tax implications for UK EMI (Enterprise Management Incentives)

I am a dual US/UK citizen, permanently resident in the UK. I have a job offer which includes EMI (Enterprise Management Incentives), also known as share options. As a US citizen, I have to file a US ...
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0answers
113 views

AMT ISO deferrals for nonimmigrant. Sold shares after leaving US

I lived in the US from 2013 and 2016 on an E-3 nonimmigrant visa. As part of my full-time employment contract, I was granted ISO shares in a pre-IPO company. I exercised most of the vested shares in ...
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1answer
80 views

Non-qualified stock options tax optimization strategy

I'm trying to understand the best strategy for reducing tax liability with non-qualified stock options. Assuming the stock price will only ever increase Exercise all newly vested options as soon as ...
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1answer
259 views

Can Directors issue themselves shares during raise?

I was wondering if it is legal for company directors that also work and operate the business to gift themselves shares during a capital raise in order to retain their controlling interest in the ...
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1answer
52 views

Where are RSUs issued from?

Beginner here. Let us say, I join some company X. They offer me 400 stocks over 4 years of vesting period. Similar to me, there will be hundreds of employees who will be joining everyday. Doing a ...
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29 views

How to distinguish insider purchases from stock option exercises?

I've read that large insider stock purchases are considered a good confidence signal for its near future. But, as I understand, the SEC reports about insider purchases may also include stock option ...
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1answer
189 views

US Tax implications? Bought stock options, paid AMT, company acquired at a loss, options worthless

Scenario (numbers are for illustrative purposes only): 2017: I exercised options when I left my former employer (startup, not public). Exercised 100% of 10,000 ISOs, common stock. At a strike price of ...
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1answer
122 views

Why are stock options named as they are?

Why are ISO stock options termed "statutory"? Because they are defined by some sort of statute? If so, then what is the statute? Similarly, why are ISOs termed "incentive" stock options whereas NQOs ...
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1answer
84 views

If employees exercise options that they are given by the company, will that increase the number of outstanding shares?

Question is simple If employees exercise options that they are given by the company, will that increase the number of outstanding shares? If yes why and if no why.
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1answer
142 views

Are there risks to having money in an ESPP if the company fails before the purchase date?

I work for a company that offers an ESPP. Employees can put money toward the plan throughout the first half of the year, and it is converted to stock at a 15% discount at the end of Q2. Stock can be ...
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5answers
16k views

How can I sell my shares in a privately-owned company I used to be employed by?

Basically, I was a software developer at a company and I was issued some stock options early on, before the company grew significantly. The company then hired a CEO who pledged to take the company ...
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9answers
601 views

Are stock options worth as much as shares?

I was undergoing salary increase negotiations (after a year) recently and it was decided a percentage of my salary was to be paid in shares. However, when the offer came, I noticed I would be getting ...
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0answers
43 views

S Corp Options Exercise Tax Benefits

I have options to purchase stock in a S Corp. Is there any tax advantage to exercising those options at least one year prior to a sale of the company for capital gains tax purposes or does concept not ...
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1answer
58 views

IRS CP2000 for Company Retention Stock Options

I was granted company restricted stock with a vesting period of 4 years. I was under the impression that upon vesting, the stock is taxed and that's all I owe. I could then sell the stock and that ...
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2answers
217 views

How do shares work when a startup is acquired?

I'm trying to estimate the value of stock options for a startup company which might get acquired in the near future. The problem is that I don't know how to incorporate the shares into the formula. ...
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1answer
164 views

Weighing unvested RSU's against stock options in a job offer

I currently have unvested restricted stock units with my employer. It's a very stable publicly-traded company. I received a job offer from a private company hoping to IPO in the next few years and ...
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0answers
99 views

Borrowing or raising funds against ISOs

I have some ISOs that are exercised (early exercised/bought) from two different companies I worked at. Their current values are around $15k each. These amounts aren't enough to transact with ...
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2answers
344 views

What are the most common partner equity distribution for startups?

Background I'm doing some due diligence regarding a US registered (Delaware C-corp) tech startup in Europe, where the founders are located and living in the EU. Although the business idea is very ...
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1answer
247 views

ISO exercise limit before triggering AMT

With recent 2018 changes to AMT, I wanted to understand how much ISO options can I exercise without making a material difference in AMT Scenario Current income 200k Claiming standard deduction for ...
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1answer
248 views

Purchase Stock but cannot pay AMT

I was released by my company and I had to purchase my ISO's within 60 days of leaving the company or lose them. The issue is to purchase them would mean around a $1.2m AMT & State Tax Bill next ...
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1answer
179 views

Can an employee be paid 100% in stock

Can an employee of a publicly listed company (Google, Facebook, Amazon,...) ask to get paid 100% in non-vesting stocks? If so, would the employee be able to defer paying taxes until he/she sells the ...
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30 views

Optimal allocation to different employer plans to reduce tax bill in current year

I am a canadian citizen that work for a canadian employer and this is how my allocation to the various employer provided plans look. I read that I am required to pay taxes on the EPSP. Can someone ...
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61 views

ICO token vesting if I quit

I am part of a post-ICO company that awards me tokens as part of compensation. My employment contract only mentions that x amount of tokens would be vested over y years with no cliff/any other vesting ...
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1answer
72 views

Executing vested options : How much tax I need to pay

I am working at a startup in California, USA and I was given some options of the type ISO, with a four year vesting period. Very soon, I will complete one year and I would like to execute 1/4th of the ...
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Canadian citizen, working for a US-based company in Toronto. How will exercising my stock options work in terms of the IRS and the CRA?

I work for a US-based company, but in their Toronto, Canada offices. On a monthly basis, I receive some amount of stock options in the Private corporation, which is based in the USA. I can exercise ...
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2answers
1k views

Offer Letter: What does “option to purchase” shares mean?

This is the first offer I have got. I do not understand a word about stock options. Please explain this to me: Subject to the approval of the Company’s Board of Directors or its Compensation ...
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197 views

Accounting for monthly vested stock options as compenstation in GnuCash

I am working for a company that has recently gone public. Now I see a monthly accumulation of options vesting every month. I would like to account for these options as compensation in my accounts. ...