RSU 83(b) Election Private Company 2027 Calculator

An 83(b) election lets you pay ordinary income tax on restricted stock at grant (when FMV is low) instead of at each vest event (when FMV may be 10-100x higher). For founders and pre-Series A employees, this can save hundreds of thousands — if the company succeeds.

Restricted Shares Granted

FMV per Share at Grant ($)

Purchase Price per Share ($)

Expected FMV per Share at Full Vest ($)

Expected FMV per Share at Exit ($)

Top Federal Bracket %

State Tax Rate %

Lifetime Savings

—

Tax Due in 30 Days

—

Recommendation

—

WITH 83(b) Election
Ordinary Income at Grant	—
Tax on Grant (fed + state)	—
LTCG at Exit	—
LTCG Tax (20% + NIIT + state)	—
Total Lifetime Tax (83b)	—
Net Proceeds (83b)	—
WITHOUT 83(b) Election
Ordinary Income at Vest	—
Tax on Vest	—
LTCG at Exit	—
Tax on LTCG	—
Total Lifetime Tax (no election)	—
Net Proceeds (no election)	—

An 83(b) election under IRC Section 83(b) recognizes ordinary income on the full grant value at grant date, instead of at each vest event. The spread between FMV and purchase price becomes immediate W-2 income, and all future appreciation qualifies as long-term capital gains with the holding period starting at grant. For founders with $0.001 strike prices, this is often free; for late-stage employees, it can be prohibitively expensive.

What an 83(b) Election Actually Does

IRC Section 83(b) lets a recipient of property subject to vesting elect to recognize income on the full FMV at grant instead of at each vest. The election is filed with the IRS within 30 days of grant. Once filed, the spread between FMV and purchase price is taxed as ordinary income immediately, and all future appreciation qualifies for long-term capital gains treatment after a 1-year hold from grant date.

Who Should File 83(b) in 2027

Best candidates: founders with sub-penny 409A valuations, first 10-20 employees of pre-Series A startups, anyone receiving restricted stock (not RSUs) where the grant-date spread is minimal. Bad candidates: late-stage employees with high FMV at grant, anyone uncertain of company survival, employees facing immediate cash flow constraints.

The 30-Day Hard Deadline

The 83(b) election must be filed within 30 days of grant — no extensions, no relief, no exceptions. Mail via USPS Certified Mail with Return Receipt to your IRS Service Center. The 2018 TCJA removed the requirement to attach the election to your tax return, but most CPAs still recommend attaching a copy as audit-trail evidence.

Last updated May 2026. Sources: IRS Publication 5528 — 83(b) Election, IRS Form W-2 Wage Reporting