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by klochner
3830 days ago
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I was talking about income tax at time of exit. If you pre-exercise and file an 83b, you realize profit as long-term capital gains rather than ordinary income. It's hard to pre-exercise if doing so costs you $100k+ in exercise costs (you have to pay the option price). Options on common stock will be set at the price of common, which can be 10x if there are no preferred shares. Read here regarding common/preferred valuations: https://www.quora.com/What-were-typical-ratios-between-409a-... |
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