Which of the following is false regarding a section 83(b)election?
A)The election freezes the value of the employee's compensation as of the grant date.
B)The election is an important tax-planning tool if the stock is expected to increase in value.
C)The election must be made within 30 days of the grant date.
D)If an employee leaves before the vesting date, any loss is limited to $3,000.

Question

Quizplus · Accepted Answer

This statement is false. If an employee leaves before the vesting date, they forfeit the unvested stock and do not receive any compensation. There is no limit to the potential loss.

Which of the Following Is False Regarding a Section 83(b)election