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I have a question regarding taxation of the stock grants. I…

Hi, I have a...

Hi, I have a question regarding taxation of the stock grants. I own stock options in a startup company. The company is not public and there is no specific market price for the stock. If I exercise these options now, how exactly is my tax liability going to be calculated?

Accountant's Assistant: The Accountant will know how to help. Is there anything else the Accountant should be aware of?

The startup is an Israeli company, so they're not subject to the same stock valuation procedures as US companies.

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Answered in 1 day by:
3/7/2018
Dr. Fiona Chen
Dr. Fiona Chen, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 1,146
Experience: Former IRS Revenue Agent
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I'm Fiona, former IRS revenue agent. I am looking at your question and will get back to you soon. Fiona Chen, MPA, Ph.D., CPA, ABV, CFF, CITP,IMTA

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Dear Customer,

The calculation will be the same as selling any capital. Your gross receipts minus your basis. The holding period is from the date you were given the stock option right to the date when you exercise your option.

The enclosed IRS website links on calculation of capital assets is enclosed for your further reference.

https://www.irs.gov/taxtopics/tc703

https://www.irs.gov/taxtopics/tc409

https://www.irs.gov/pub/irs-pdf/p544.pdf

Please feel free to follow up.

Regards,

Fiona

Dr. Fiona Chen
Dr. Fiona Chen, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 1,146
Experience: Former IRS Revenue Agent
Verified
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