Tag: Nicholas Markwordt

The 83(b) Election: What Startup Founders Need to Know
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The 83(b) Election: What Startup Founders Need to Know

There's a critical choice founders must make when making a Section 83(b) election. The 83(b) election is a provision under the Internal Revenue Code that gives an employee or startup founder the option to pay taxes on the total fair market value of restricted stock at the time of granting.If one waits too long to decide, founders or employees granted company stock could face some profound tax implications. Let's start with the basics. What is Restricted Stock? While many startup companies give stock options to employees, some grant restricted stock to its founders and certain employees. Restricted stock is granted to a stockholder but limited in that it cannot be transferred or sold by that stockholder and may even be taken back by the company until certain conditions are met...