> Not just the tax burdens, the exercise price as well Sure, but the exercise price is effectively set by the taxman. If you set it too low, they’ll just charg

> Not just the tax burdens, the exercise price as well Sure, but the exercise price is effectively set by the taxman. If you set it too low, they’ll just charge more tax. See https://assets.fenwick.com/legacy/FenwickDocuments/409_Valuations_Stock_Options.pdf https://assets.fenwick.com/legacy/FenwickDocuments/409_Valua... “Employees, officers, directors and consultants who receive stock options with exercise prices that cannot be shown to be at or above the reasonably-determined FMV on the date of grant face immediate tax on vesting at a combined federal and state tax rate as high as 85% or more.” The game is rigged in the taxman’s favour. If the tax was calculated at the exercise (or grant!) date but only due upon sale of the shares (or using those shares as collateral to loans etc), the system would be a lot fairer. Especially for illiquid shares in private companies, where it may be years until you could receive cold hard cash for your shares.