stock option share
Employee is not subject to Income Tax until shares acquired
Incentive Stock Options.
An incentive stock option (ISO) is an option right to purchase stock of the employer, often at a discount. Unlike a nonstatutory stock granted by a corporation (or related corporation) to an employee giving him or her the option (1923),
if certain requirements are met, no gain or loss is generally realized by the employee when an ISO is granted or exercised (Code Sec. 421 (a)).22 Instead, the employee is not subject to income tax until shares acquired by the exercise of the option
are sold