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Similarly, taxes are applied to capital gains when stock is sold, not when it is received or bought. The employees would not be taxed just for receiving the st
by iepathos 4y ago
Similarly, taxes are applied to capital gains when stock is sold, not when it is received or bought. The employees would not be taxed just for receiving the stock/ownership, only once they sold it and made it liquid.
- deleted 4y ago[deleted]
- double_nan 4y agoTaxes are due at vesting.
- davidlumley 4y agoTo be clear: taxes are due when you receive the shares. For options, that's when you execute/purchase your options not when they vest. edit: (in the US at least)
- johnebgd 4y agoThe taxes can also be due when you receive your options. That can depend on if you purchase your options or if they are granted to you and entitle you to a discount. YMMV but an NQSO purchase agreement can be your friend.
- girvo 4y agoNo, you can absolutely be taxed just for receiving the stock/ownership.
- ideamotor 4y agoIf it’s not worth much and it’s spread across many employees, we aren’t talking about much.
- deleted 4y ago[deleted]
- NavinF 4y agoWrong. It will be valued at something ridiculous like 20x EBITDA (average for tech related companies) and you'll be taxed on that number.
- ideamotor 4y agoDoesn’t that depend on who values it? Also, I get the impression they have quite a few liabilities.
- NavinF 4y agoIn the GN interview they said they have plenty of cash. I'm sure they'll have to write down a lot of inventory because prices went down, but for tax purposes their valuation is still going to be very high based on earnings. That's why private companies other than startups rarely go this route.
- googlryas 4y agoYou're taxed for the value of the stock when you receive it, and you are taxed on capital gains when you sell it, if you're selling it for more than you received it.