The 83(b) election: the 30-day deadline every founder needs to know

If you got restricted stock that vests over time, you have 30 days to file one form. Miss it and there's no do-over.

If you just founded a company and received stock that vests over time, there’s a form you need to know about, and a clock that’s already running.

What it is

Normally, when restricted stock vests, the IRS treats the value of the shares on the vesting date as income. If your company is doing well, that means you could owe tax every time a chunk vests, on shares you can’t sell, at a value that keeps going up.

An 83(b) election flips that. You choose to be taxed on the stock now, at grant, instead of as it vests. For most founders, the shares are worth almost nothing at grant, and you often paid that same amount for them. So the taxable income is usually zero or close to it.

After that, there’s no tax at vesting. You only deal with tax when you eventually sell, and your holding period for capital gains starts at grant instead of at vesting.

The deadline is 30 days. Really.

You have 30 days from the date the stock is granted to file the election with the IRS. Not 30 business days. There are no extensions and no late relief. If you miss it, you’re on the default tax-as-it-vests path.

How to file

Fill out the election. The IRS has Form 15620 for this, or you can use a written statement with the required information.
Mail it to the IRS office where you file your return. Use certified mail with return receipt so you have proof of the date.
Give a copy to your company.
Keep a copy forever. Seriously. Future acquirers and their lawyers will ask for it.

You no longer have to attach it to your tax return.

When it might not make sense

If the shares are already worth a lot at grant, filing means paying real tax up front on stock that could still lose value or never vest. That’s a judgment call worth running numbers on.

The short version

Got restricted stock? Check the grant date today. If you’re inside the 30 days and not sure what to do, ask in your Slack channel or book a call. This is one of the few tax decisions with a hard, unforgiving deadline.