Does the holding period apply to non-qualified stock options?
September 13, 2004
Date: Thu, 26 Aug 2004
If a person was to consider swapping $50,000 of X company stock to exercise his ISOs, assuming the stock was obtained through a past NQ option, does the 50,000 worth of stock need to have been held for one year and held from two years since it was granted? Or does this only apply to stock that was previously obtained through an ISO?
Date: Fri, 10 Sep 2004
The holding period rules don’t apply to stock acquired from a non-qualified option, so you don’t have to hold that non- qualified option stock for that period in order to do the swap. If the non-qualified option was vested and the stock was vested, then when you exercise the non-qualified option, the acquisition date for the NQO stock is the date of exercise of the non- qualified option.