Employee Stock Options - US Startup

While exercising, you just have to pay the exercise amount within the three months time period.

You'll be taxed only when you liquidate these exercised options which generally isn't bound by any time limit but confirm with your HRBP once.

I can help here based on a few conversations I had with my friend in a similar situation. If you have a three-month exercise period for your stock options, here’s how you could navigate through:

1. Tax Implications: Exercising options means paying taxes on (Stock Value - Exercise Price)*Quantity.
2. Cash Flow: Ensure you have the funds to cover this tax liability within three months.
3. Evaluate the Company: Assess the startup’s growth potential to justify the tax burden.
4. Consult a Tax Advisor: They can help optimize your strategy and tax impact. My friend did this and he understood the pros and cons of exercising the stocks.
5. Financing Options: Look into financing services to cover exercise costs and taxes.

For more details, check resources like https://www.investopedia.com/terms/s/stockoption.asp, IRS guidelines - https://www.irs.gov/newsroom/employee-stock-options, and Fairmark - https://fairmark.com/compensation-stock-options/