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by CalChris 3191 days ago
Please, please beat 83b into every founder’s head and make sure they’ve internalized it so they get this boring form right for their employees.

You’ve got 30 days or you’re paying income rather than capital gains. If WSGR incorporates the startup they will get this right for the founders. Sign this, sign this, this and this. But will the founders get this right for their employees?
2 comments
kirsty 3191 days ago
Agreed that 83b elections are crucial - there is very little a company can do if the form does not get filed within the 30 day window. The consequences of not filing the election can be significant for both the company and the employee.

Clerky has the 83b election form (where necessary) as part of their Hiring package so that when the employee is allocated equity and signs the documents, it is automatically completed. However it is up to the employee to mail it in since it has to be sent via mail and can't be sent electronically. The company should make sure they are chasing the employee to do this and to get a copy of the election for the company's records.

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nostrademons 3191 days ago
Clerky beats 83(b) into the heads of founders who use its service. It's included in the package, with pre-filled forms and detailed instructions for where to mail them, and it sends you nag mail every week until you've uploaded the completed IRS form. It works for employees, too, but they don't get the nag-mail.

The folks who I think really need to teach their employees about 83(b)s are fast-growing big companies. I didn't know about them when I joined Google, for example, and learned about it too late to take advantage of it. That mistake cost me literally hundreds of thousands of dollars.

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CalChris 3191 days ago
Yeah, and Google's HR is supposed to rock. They got my business cards on my desk on day one, but really.

I will look Clerky over. I admit I was just thinking of them as a formation forms generator.

I'm more worried about operations after formation. I'm surprised that Xero doesn't get much discussion. Founders are going to be everything early on. They're going to be accountants too.

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