Everything I’ve read seems to be saying that the fair value of the Restricted Stock granted must be declared as ordinary (compensation) income in the year of the grant if the 83b election is taken within 30 days of the grant. But is this for the entire grant?
Situation: Exec is granted 100,000 shares of company stock that vests at 25% per year over the next 4 years. He’d like to use the 83b election as he feels the company is in a good position for manufacturing hardware that will be necessary with the new 5G networks. But at the current price of about $18/share, this means having to include $1.8MM in income and coming up with the tax…something he can do but it would financially stretch him pretty thin. So does he have to include the entire grant or can he do a year at a time….that is, in this case, take the 83b on 25,000 shares at the beginning of each year before they vest?