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Subject:   Worthless NQSOs
Date:   9 Apr 2008
From:   Cortney

Hi,

Is there any scenario where worthless NQSOs could be used for some tax benefit where a loss can be claimed?

Thanks,
Cortney

Answer

Date:   6 May 2008

Hello Cortney,

Since no income is reported when the options are received, they have no tax basis and no loss can be claimed for them when they expire worthless.

Good luck!

Mike Gray

For more information about non-qualified stock options, request our free report, Non-Qualified 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.