Showing posts from May, 2015

Entrepreneurs and the Section 83(b) Election

Entrepreneurs need to be aware of the 83(b) election.  In simple terms, you are taxed on any equity compensation that you receive in the same way that you are taxed on your other income.  The IRS requires you to pay taxes on that equity compensation in the year that it is actually transferred to you.

Founders' stock is often subject to incremental vesting over a number of years.  If the founder does nothing, she would incur tax liability for the value of the stock at the time it vests.  Assuming that the value of the stock price is rising over the course of the vesting schedule, the value of the stock at the time of vesting could continue to increase (or fluctuate) so that the founder pays more taxes over time.

Rule for Unvested or Restricted Property Subject to a “Substantial Risk of Forfeiture” The fair market value of the property is NOT included in the income of the service provider at the time of grant. Instead, the taxpayer includes the fair market value of the property at the t…

IRS updates its list of "Bad" banks

Taxpayers in the 2014 OVDP face a 50% penalty if they had accounts at any of the following:
UBS AGCredit Suisse AG, Credit Suisse Fides, and Clariden Leu Ltd.Wegelin & Co.Liechtensteinische Landesbank AGZurcher Kantonalbank swisspartners Investment Network AG, swisspartners Wealth Management AG, swisspartners Insurance Company SPC Ltd., and swisspartners Versicherung AGCIBC FirstCaribbean International Bank Limited, its predecessors, subsidiaries, and affiliatesStanford International Bank, Ltd., Stanford Group Company, and Stanford Trust Company, Ltd.The Hong Kong and Shanghai Banking Corporation Limited in India (HSBC India)The Bank of N.T. Butterfield & Son Limited (also known as Butterfield Bank and Bank of Butterfield), its predecessors, subsidiaries, and affiliatesSovereign Management & Legal, Ltd., its predecessors, subsidiaries, and affiliates (effective December 19, 2014)Bank Leumi le-Israel B.M., the Bank Leumi le-Israel Trust Compay Ltd., Bank Leumi (Luxembourg) …