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Well, part of the problem is that even if value is calculated right, there's no adjustment for liquidity. Calculating compensation for H1-B purposes based on 40

Well, part of the problem is that even if value is calculated right, there's no adjustment for liquidity. Calculating compensation for H1-B purposes based on 409A is a bit silly if there's no way to cash out. That's made all the more true by the possibility of destroying that value later, for instance by agreeing to a high-multiplier preference in later funding. I would accept 409A as a reasonable assessment of a company's value, but that's somewhat different than an assessment of what compensation an H1-B worker is getting.

mavelikara 10y ago
You raise a good point about liquidity. The PDF linked by OP said "including cash bonuses and similar compensation", and the knee-jerk reaction was "it is a joke". Furthermore, it was explainted that "the value of private company stock can be hard to determine". I pointed out the 409A valuation as a response to this. I do not know if equity will be counted against income. But I think it is reasonable to count vested and exercised equity into the pay calculation. After all, IRS uses that to determine taxes.