Not that long ago I’ve been granted a certain amount of company stock options as a Christmas bonus (the company is listed on the US stock exchange. Basically I can buy some shares at a predefined price.
The last step is to accept the grant or not. It seems to me that it can be only beneficial, however before I accept it I would like to ask my fellow Mustachians: Has anyone of you some experience with this kind of securities? Is there something peculiar that I should be aware? Are there some risks/tax implications?
Basically your company is granting you options on its stock at a predifined price as a christmas gift, feel free to correct my understanding should it be incorrect.
Basically, this gift will be requalified as salary and accordingly it would result a tax liability. To the question should you accept the grant or not? Do you have any other option, i.e. can you refuse and get cash instead?
I hope this helps
You’re totally correct, that’s what it is.
Unfortunately, there’s no other option but to take these options
However, I’ve done some research and it becomes taxable only at the moment of exercise, so I accepted and I wish the best for the company now more than ever