The special § 83(b) election (i.e., where income is taxed in the year of the grant) with respect to a restricted stock plan may be advantageous in which of the following situations?

Question

Quizplus · Accepted Answer

If the bargain element is relatively small, electing § 83(b) can be advantageous because the tax paid upfront is minimal, and any future appreciation will be taxed at capital gains rates rather than ordinary income rates.

The Special § 83(b) Election (I