Karen receives the right to acquire 400 shares of Fremont Corporation stock through the company's incentive stock option plan.The fair market value of the stock at the date of the grant is $15 and the exercise price of the option is $19 per share.The fair market value of the stock at the date of exercise is $22.At the date of exercise,the tax consequences to Karen and the Fremont Corporation are

Karen Fremont

Question

Karen receives the right to acquire 400 shares of Fremont Corporation stock through the company's incentive stock option plan.The fair market value of the stock at the date of the grant is $15 and the exercise price of the option is $19 per share.The fair market value of the stock at the date of exercise is $22.At the date of exercise,the tax consequences to Karen and the Fremont Corporation are
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Karen Fremont

Quizplus · Accepted Answer

Incentive stock options (ISOs) do not result in taxable income for the employee (Karen) or a tax deduction for the employer (Fremont Corporation) at the date of exercise.

Karen Receives the Right to Acquire 400 Shares of Fremont