3 ms·
Good point, although do long term cap gains apply to private company stock being held over years until the liquidity event?
by creaghpatr 8y ago
Good point, although do long term cap gains apply to private company stock being held over years until the liquidity event?
- l2c1928 8y agoI paid long term capital gains after selling a portion of my private stock via a tender offer last year.
- bgentry 8y agoYou get switched to long term capital gains 1 year after exercise or two years after the grant start date, whichever is later.
- theIV 8y agoI don't believe the "or" part of this statement is right. I think you still need to hold for 1 year after exercise AND two years after the grant for long term to kick in. Not sure what the best source on this is, but a quick DDGing: https://www.fool.com/knowledge-center/tax-rate-on-exercising-stock-options.aspx https://www.fool.com/knowledge-center/tax-rate-on-exercising...
- bgentry 8y agoI think we're saying the same thing. If I early exercise my options on day 1, then I still have to wait until the 2 years after the grant date (2 years of employment) to get long term capital gains treatment. If I wait 4 years, then exercise, then I have already satisfied the 2 years post-grant requirement, but I still have to wait a year after the exercise to get long term capital gains treatment. The key part was my last clause: "whichever is later".