🚀 Founding

83(b) elections

Lesson 5 of 5 · 5 min read

If you receive restricted stock subject to vesting (every founder does), file an 83(b) election with the IRS within 30 days.

Why: without it, you owe income tax as the stock vests at its (rising) fair market value — which can mean huge tax bills with no liquidity. With it, you pay tax once at formation when shares are nearly worthless.

Miss the 30-day deadline = no fix. Set the alarm.

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