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Subject:   After vestment
Date:   Wed, 6 Dec 2000
From:   Ron

Dear Michael,

If I hold NQSO's for 2 years after vestment will that change the income status from "ordinary" income to long term capital gains?

Thanks,
Ron

Answer

Date:   12 Feb 2001

Hello Ron,

I’m sorry, holding NQSOs for two years after vesting will not change the income status to capital gains.

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.