Technology Law Experts
So the main advantages of an ISO over an NQSO are (a) capital gains tax treatment, instead of ordinary income tax treatment, on the spread between the exercise price and the fair market value of the stock at the time of sale and (b) the absence of a company tax withholding requirement when ISOs are exercised.
© 2013 by Robert G. Schwartz, Jr. All rights reserved
Disclaimer: This summary is provided for educational and informational purposes only and is not legal advice. Any specific questions about these topics should be directed to an attorney.
The Practical Tech Lawyer: How Are Stock Options Taxed?