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Has anyone ever got in actual trouble for this? I doubt…
Earlier quoted context omitted.
How is that relevant?
It's a joke in reference to the founder of Carta acting bitter upon being caught with his hand in the cookie jar, wherein said founder says that the person who posted about the incident on Twitter should have talked to him first, "founder-to-founder": https://twitter.com/henrysward/status/1743794996732735679
But the joke theory seems possible.
https://gijn.org/stories/seeking-comment-for-your-investigat...
Not all startups allow this type of early exercise. If you exercised ISOs/NSOs only after they vested, this problem can't apply to you.
All example 83-b have this problem. Since there is no form and it's just a letter, you can just add the line and do it yourself. IANAL.
"We follow the practice of major law firms in the venture space and do not include a spousal consent for the 83(b) election in community property states. We also confirmed with our tax counsel, and they confirmed our approach is advisable."
No one should lose sleep over it. Spouse didn't sign off on a $500 payment to buy restricted stock (early startup stock), so IRS will come down heavily on you for material harm --- will not stand in court!
My 2 cents anyway based on legal advice received.
It seems to be a non-issue to me. From my attorney a few months back: "We follow the practice of major law firms in the venture space and do not include a spousal consent for the 83(b) election in community property states. We also confirmed with our tax counsel, and they confirmed our approach is advisable." No one should lose sleep over it. Spouse didn't sign off on a $500 payment to buy restricted stock (early sta…
Has anyone ever got in actual trouble for this? I doubt…
This isn’t the sort of thing I expect people to “get in trouble” for at the time of filing. I expect that years later, if the startup turns out to be worth something and the taxpayer is audited, the auditors will go through old paperwork and discover a very large amount of taxes they can collect.
So, does anyone known of someone who actually got screwed by this in an audit? I'm sure it has happened often enough that at least someone out there has been audited who would be affected.