What are "discounted" stock options, and how are they taxed?

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NQSOs: Taxes Advanced

What are "discounted" stock options, and how are they taxed? This is premium content

Stock options are usually granted with an exercise price equal to the fair market value (FMV) of a share of company stock on the grant date of the option. Once it falls below the FMV they become discounted stock options, which raise multiple issues, including...

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