SPECIAL RETIREMENT PLAN ISSUES (3 OF 3)
01.Core Concepts
Stock Options • Non-Qualified Stock Options (NQSO) • Grant: no income recognition • Exercise: ordinary income on bargain element (excess of FMV over exercise price) • Sale: LT or ST capital gain • Incentive Stock Option (ISO) • Grant: no income recognition • Exercise: no income recognition • Sale: LTCG if held for 2 years from date of grant and 1 year from date of exercise