Recommend Our Site to Your Friends!

Print This Page

Date:   Wed, 17 Jan 2001
From:   Mo

Can you use the same mature ISOs again and again to acquire more ISOs? or only once?

Answer

Date:   9 Feb 2001

Hello Mo,

Once the shares received meet the holding period requirements, they may be used in exchange to exercise another ISO.

When you do this many times (holding the shares the required period each time), the accounting can become very complicated because you have to keep track of the basis adjustments for alternative minimum tax for the shares received.

Good luck!

Mike Gray

For more information about incentive stock options, request our free report, Incentive Stock Options - Executive Tax and Financial Planning Strategies.

IRS Circular 230 Disclosure: As required by U.S. Treasury Regulations, you are hereby advised that any written tax advice contained in this answer was not written or intended to be used (and cannot be used) by any taxpayer for the purpose of avoiding penalties that may be imposed under the U.S. Internal Revenue Code.