I believe that the taxable event happens when the option is exercised, whether any shares are sold or not. Actually selling the shares doesn’t change the amount

I believe that the taxable event happens when the option is exercised, whether any shares are sold or not. Actually selling the shares doesn’t change the amount of tax due. I don’t know that he will sell shares to cover the strike price or the taxes, but I can say certainly it is explicitly permitted for him to sell shares only for that reason. Otherwise they must be held for at least (EDIT) 5 years post exercise. He can simply hold the vested option but not exercise it. All options expire by 2028, and all vested options must be exercised within 1 year if he loses the CEO title. He does not gain any shareholder rights from those shares until the options are exercised. So this delays the payment of the strike price and taxes, but does not alter the basic math. In short, a 2% bump in his equity position is below the noise floor of the daily price change of the actual shares. Frankly it almost makes you wonder what’s the point. Once you own double digit percentages of an asset that could appreciate more than 10x it’s more important to focus on the size of the pie than the size of your slice. The vast change in Elon’s wealth was through achieving an IPO and getting the share value upwards of $800. An extra few million shares to him is the same as the difference between selling on a Monday or a Tuesday.