> they can roll that tax credit forward to cover future gains they may get at some other point in the future. I'm not sure how long you can roll these losses fo

> they can roll that tax credit forward to cover future gains they may get at some other point in the future. I'm not sure how long you can roll these losses forward, but I think it's for a substantial period of time. IIRC it's only 7 years. For people who do a lot of transaction, that's enough. For employees that get to invest 3-4 years in a company to make a profit on equity, it's actually quite rare to make use of this. Also, everyone keeps forgetting that even liquidity-event-induced-exercise very often doesn't come with the liquidity that makes it profitable: In the case of a public stock exchange event, the 6-month lock-up period required by SEC rule 144 (and/or the underwriters), the stock can go down 90%, which means you pay 15-60% taxes on imaginary gain, even if you played your cards perfectly. This one also applies to investors.