When is my incentive stock option holding period over?

October 26, 1999

Date:   Tue, 19 Oct 1999
From:   Cheryl

Everything that I read indicates that one of the requirements to avoid a disqualifying disposition of an ISO is that you must hold the stock that you aquired for one year after the date you exercised the ISO. I understand this but wanted to confirm the definition of one year. For example, I would assume that if I exercised the options on December 20th of last year than my one year waiting period would be up on December 20th of this year. Is this assumption correct?

Thank you for your help.



Date:   Tue, 26 Oct 1999

Hello Cheryl,

The shares must be held more than one year.

In your example, the holding period requirements would be met December 21, 1999, provided you also held the stock more than two years after the option was granted.

Good luck!

Mike Gray

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

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