Before you do anything with your incentive stock options, you need to get clear on how exercising those ISOs could affect your assets and your cash flow, and what will it cost you in terms of real money. You need to know the cost of exercising your options, for...
Category: Incentive Stock Options
Six Things to Know About Pre-IPO Incentive Stock Options
The choice of when to exercise your incentive stock options can be a difficult one, with serious implications for financial planning and taxes. When your company is still pre-IPO, that opens up an entirely separate set of concerns that you may need to be aware of. The issues associated with pre-IPO incentive stock options (ISOs) are particularly relevant now, as early-stage companies increasingly find private funding sources and delay the date of their IPO. As the length of time between startup and IPO increases, more and more employees are facing the question of the costs and benefits of pre-IPO ISO exercise.
7 Things You Should Know About Incentive Stock Options
Incentive stock options (ISOs) are a form of compensation distributed by a company to their employees. Typically, companies use incentive stock options as a vehicle to retain top employees, reward specific milestones or successes or as an incentive when hiring new...
How to Use the Alternative Minimum Tax Credit Effectively in Retirement
If you have incentive stock options, you’ve likely heard of -- and perhaps already paid -- the alternative minimum tax. This is the tax due in the years you exercise and hold incentive stock options, or ISOs. You might also be entitled to an AMT tax credit if that’s...
5 Reasons Why You Might Want a Disqualifying Disposition for Your Incentive Stock Options
Even though you may pay a higher tax rate by selling your incentive stock options as a disqualifying disposition, you may not want to completely discount the benefits of an exercise and sell quite yet. The alternative, of course, is to earn the right to capture your...
Why Waiting to Exercise Your Incentive Stock Options May Increase The Alternative Minimum Tax
Incentive stock options are unique in that the longer you wait to exercise, the costlier it may be to exercise and hold your shares. That’s not because exercising the incentive stock option cost more, as that price is fixed, but because the cost of the alternative...
How and Why to Exercise Your Incentive Stock Options Early in the Calendar Year
Ready to exercise your incentive stock options (ISOs)? Then you have many strategies to consider for how and when to take the next steps. Potential plans to implement include exercising well before the ISOs are set to expire, exercising as expiration nears, or...
6 Reasons to Exercise Your Incentive Stock Options When the Price Is Down
No one likes to see a stock they own go down in value. When we buy stock, we hope the price rises so we can earn a profit on our purchase. It’s bad enough, then, when our share prices fall instead. But what’s potentially even worse? Seeing those falling stock prices...
4 Taxes to Plan for When You Sell Your Incentive Stock Options
If you try and look up information to learn more about your incentive stock options, most of what you’ll find addresses what happens when you exercise your options -- but doesn’t go much farther than that. You may already know that when you exercise your incentive...
How and When Are Incentive Stock Options Taxed
Incentive stock options are a form of employee compensation that allows you to participate in the appreciating value of a company's stock price. A type of stock option that comes with potentially complicated tax scenarios. Similar to non-qualified stock options,...
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