>Options are not taxed until you exercise them. At that point they become an asset that contains "value"... The assertion that they then contain value is the c

>Options are not taxed until you exercise them. At that point they become an asset that contains "value"... The assertion that they then contain value is the contentious point. To the IRS it is defined to have value. To me, it has no more value than the option, because there's no more market for those shares than there is for the options themselves. "Fair market value" is weird when there's no market.