I have to admit I was quite surprised by this part of the article. Can someone give a slightly more detailed example of how this works and more specifically how

I have to admit I was quite surprised by this part of the article. Can someone give a slightly more detailed example of how this works and more specifically how most people manage it? Basically you get stock from your options (which you exercise) and then you have to pay tax on the worth of that stock, which gets counted as a sudden income? I guess it makes sense you get taxed somewhat on this, as it is in a sense part of your income at the company, but I don't really understand how this works.