DESCRIPTION
This module introduces common forms of equity-based compensation, including stock options, restricted stock, restricted stock units, and stock appreciation rights. Key characteristics and federal tax attributes of each type of equity-based compensation are explored, with comparisons highlighting their practical differences. The module also examines the implications of making, or not making, §83(b) and §83(i) elections. Visual examples and practical exercises reinforce the application of these concepts.
LEARNING OBJECTIVES
- Define key terms related to equity-based compensation, including stock options, restricted stock, restricted stock units (RSUs), and stock appreciation rights (SARs).
- Differentiate the key characteristics of common equity-based compensation arrangements.
- Identify the federal tax treatment of common equity-based compensation arrangements.
- Evaluate the advantages and disadvantages of making a §83(b) election.
