Taxes — The Part Nobody Wants to Read
AMT traps, the 83(b) election, QSBS (the holy grail), capital gains timing, and what to actually do.
What you’ll learn
- ✓AMT (Alternative Minimum Tax) and when ISO exercise triggers it
- ✓The 83(b) election — what it is, the 30-day deadline, and how to file
- ✓QSBS (Qualified Small Business Stock) — the $10M tax exclusion
- ✓Long-term vs. short-term capital gains timing
- ✓Tax implications of early exercise
- ✓What to do when you have paper gains but can't sell
Stock options are tax-advantaged, in theory. In practice, the tax code around startup equity has more landmines than any other corner of personal finance. People have exercised options, owed six-figure tax bills on shares they couldn't sell, and faced genuine financial crises — not because they made bad bets, but because they didn't understand the rules.
The good news: with the right timing and elections, you can legitimately minimize what you owe. The bad news: the window to make those decisions is often narrow, and missing it costs you permanently.
In this chapter, you’ll work through the exact framework for taxes — the part nobody wants to read. We cover each of the key topics with worked examples, real numbers, and actionable steps you can take immediately.
- ✓AMT (Alternative Minimum Tax) and when ISO exercise triggers it
- ✓The 83(b) election — what it is, the 30-day deadline, and how to file
- ✓QSBS (Qualified Small Business Stock) — the $10M tax exclusion
- ✓Long-term vs. short-term capital gains timing
- ✓Tax implications of early exercise
- ✓What to do when you have paper gains but can't sell
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