Skip to main content

We have a CAB underway (using the Advisor Template) and they're asking if we have documentation that this falls under an 83(b) election w/ respect to IRS requirements so that their accountant can submit that. Any suggestions?

Mia Scott avatar
Written by Mia Scott
Updated over 4 years ago

I would assume this does NOT fall under 83(b) and just let them let their accountant know that. 83(b) is referring to a special program you will normally only do for early / special employees. You won't do this for your advisors.

83(b) allows option holder to purchase their shares today, and the company has the right to buy them back later if the employee leaves early (instead of a vest where the employees earn the shares over time). You will do this for tax reasons as a benefit for early employees -- but it's not trivial to set up, and allows for an early purchase of shares which you don't want to do w/ most advisers.

Did this answer your question?