RE: Warrant taxation- I talked to my CPA yesterday
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Posted On: 04/03/2020 10:33:10 AM
RE: Warrant taxation- I talked to my CPA yesterday and warrants acquired in a PIPE- which I assume most of us here have- are taxable when the share is sold. You would have to exercise and hold shares for 1 year to get capital gains treatment.
I have been firm in my position that I wouldn't exercise until just before expiration in March 2023, but I am scared of what would happen in a buyout. Effectively, I'd pay 15%+ more in taxes on 100,000 shares over $.75. If there was a big buyout, that stings. Quite the dilemma.
Warrants awarded-not purchased- could be treated differently, but that's a matter for board members and executives.
I have been firm in my position that I wouldn't exercise until just before expiration in March 2023, but I am scared of what would happen in a buyout. Effectively, I'd pay 15%+ more in taxes on 100,000 shares over $.75. If there was a big buyout, that stings. Quite the dilemma.
Warrants awarded-not purchased- could be treated differently, but that's a matter for board members and executives.
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