In 2011, P receives stock worth $15,000 from Q Corporation as payment for services rendered.The stock is subject to substantial risk of forfeiture, i.e., if P leaves Q Corporation before 2013, she must forfeit the stock.P chooses to make a § 83(b) election and include the $15,000 value of the stock in her 2011 gross income.In 2013 the risk of forfeiture lapses, the property is worth $38,000.

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By making a Section 83(b) election, P chose to include the value of the stock in her gross income in 2011, when the stock was subject to a substantial risk of forfeiture. This means she pays taxes on the stock's value at the time of receipt, regardless of its future value or whether the forfeiture condition is met. Therefore, when the risk of forfeiture lapses in 2013 and the stock's value increases, P does not have to include the increase in value in her gross income for that year.

In 2011, P Receives Stock Worth $15,000 from Q Corporation