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With (3), they'd be taxed on the gains when they sell. Not "tax free" at all. The difference is that they wouldn't be taxed until the gains were realized not w
by caseysoftware 4y ago
With (3), they'd be taxed on the gains when they sell. Not "tax free" at all.
The difference is that they wouldn't be taxed until the gains were realized not when they were imagined on paper.
- tyre 4y agoThe reason we have capital gains is to encourage investment. They're not investing $1 for 1m shares to build something better. They're getting $1m worth of something for $1, risk-free. That gap between strike price and FMV is much more like compensation than it is an investment.
- buryat 4y agoyou can borrow against this asset and get basically a tax-free loan
- KptMarchewa 4y agoCan you _actually_ borrow against completely illiquid, pre-IPO asset?
- konfusinomicon 4y agoexactly this. tax time will come, hopefully. until then it's a tax on monopoly money.