3 ms·

You'd still have to pay taxes on it as per your (audit-able) 409a valuation.

• ska 10y ago
  Sure, depending on the country it works different ways. But if there is tax to pay, it is on a low valuation (very early, remember).
  • argonaut 10y ago
    To be fair, there is another catch-22, which is that a low valuation means the startup is early-stage, which means your options are worth less. So sure, you can early exercise, but there is a greater chance your early exercising will lose you money (if the options end up worthless).
    • ska 10y ago
      Note I said "give stock", not "give options". Granted, this doesn't solve everything - it was an aside comment about early stage vesting (where liquidation events can be a long way off)
      • argonaut 10y ago
        My comment is equally valid if you replace "early exercise" with "paying taxes on" (assuming you do an 83b election).