Little Known Secrets of Incentive Stock Options

For many of Thimbleberry Financial's clients in the  startup and tech communities, Incentive Stock Options, or ISO's, are a hot topic.  Today, Amy Walls and Jag break them down. Simply put, an ISO is a type of employee stock option that comes with tax advantages.  No income tax is due when options are granted or exercised. Also, profits from the sale of ISO's can be taxed under more favorable long-term capital gains rates, provided certain conditions are met. In addition to those restrictions around time of holding, Amy also explains the Alternative Minimum Tax, or AMT.  When do you pay AMT, and what AMT implications should you consider when exercising ISO's? We also walk through vesting, expiration, and post termination. Being proactive and creating a plan is key in this realm; there are certain decisions and actions that cannot be undone.  Amy explains the $100k rule and the Rule of 65, and she cautions against being overweighted in company stock, particularly in the context of market volatility. For more information contact Amy Walls and her staff at 503-610-6510 or click here Thimbleberry Financial. To get in touch with Amy and her team at Thimbleberry Financial, call 503-610-6510 or visit thimbleberryfinancial.com.