If you have an Incentive Stock Option program at work, that can be quite profitable.
The big advantage of an Incentive Stock Option is that you do not have to report any income on your tax forms when you receive a stock option grant or when you exercise that option. You report the taxable income when you sell the stock.
When you sell the stock, the amount of tax you pay depends on how long you have held the stock and when the ISO grant was made. The best option, tax-wise, is if you can wait at least a year and a day after you purchase the stocks, and at least two years after you were granted the option to sell the stocks. Any profit on the sale is treated as a long-term capital gain.
You can find more information here.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
