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Date:   Thu, 20 Apr 2006
From:   Anonymous

Mr. Gray,

I have stock options from a private company. Are these exercisable?

Answer

Date:   01 May 2006

Hello,

Such options shouldn't have been granted unless they are exercisable. A bigger issue is, "Can you sell the shares?" There are usually severe limitations for selling private company stock. That's one reason you have to be very careful when exercising options in a private company. You can be required to pay a tax without having the cash to pay it.

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.