'How to File an 83(b) Election (and the 30-Day Deadline)'

TL;DR: An 83(b) election tells the IRS to tax your unvested startup stock now, at today's tiny value, instead of taxing each tranche as it vests at a (hopefully) much higher value. You have 30 days from the date the stock is transferred to you to file — no extensions, no exceptions. Since April 2025 you can file on the standardized Form 15620, by mail or through your IRS Online Account.

Last updated: June 2026

What an 83(b) election actually does

When you receive startup equity that vests over time — founder shares with a repurchase schedule, or stock from an early-exercised option — the IRS treats the "unvested" portion as something you don't fully own yet. By default, you're taxed as each chunk vests, on the difference between what you paid and what the stock is worth on that future vesting date.

An 83(b) election is a short statement to the IRS that says: tax me on all of it now, as if it were fully vested today. You're choosing to recognize the income up front.

That sounds like volunteering for tax. It usually isn't. On day one of a startup, your stock is typically worth pennies — often the same price you paid for it, meaning the taxable spread is $0. You lock in that near-zero value, and all the future appreciation gets taxed later as capital gains when you sell, not as ordinary income as it vests.

Miss the election, and the IRS taxes years of appreciation as ordinary income, tranche by tranche, on a vesting schedule you don't control.

Who should consider filing one

The election only matters when you receive stock that is subject to vesting or a repurchase right. The common cases:

If you bought founder stock at a nominal price the week you incorporated and signed a vesting schedule, you are the textbook person who files an 83(b).

The 30-day deadline (the part founders blow)

You must file within 30 days of the date the stock is transferred to you. This is the single hardest rule in the whole process:

• The clock starts at transfer, not at signing. "Transferred" generally means the date your board approved and issued the grant — not the day the shares show up in your cap table tool, and not the day you got around to mailing the form.
• It's 30 calendar days, including weekends and holidays. If day 30 lands on a Saturday, the practical move is to file before it.
• There are no extensions and no late filing. The IRS does not grant relief, and courts have consistently refused to excuse missed deadlines. If you miss it, there is no cure — you live with default vesting-date taxation.

Treat the transfer date as a hard deadline the moment you sign your stock purchase agreement. Put it on a calendar that day.

How to file an 83(b) election, step by step

1. Confirm your transfer date and value

Pin down the exact date the stock was transferred and the price you paid versus its fair market value on that date. For most founders at incorporation, purchase price equals fair market value, so the spread — and the tax — is zero. You still have to file to get the benefit.

2. Complete Form 15620

In April 2025 the IRS released Form 15620, "Section 83(b) Election" (Rev. 4-2025) — the first standardized form for this. Before that, founders wrote their own election letter; a compliant letter still works, but the form removes the guesswork about what to include. It captures your name and taxpayer ID, a description of the stock, the transfer date, the amount you paid, the fair market value at transfer, and the amount you're including in income.

3. File it — online or by mail

You now have two routes:

• Online (IRS's preferred method). Sign in to your IRS Online Account (identity verified through ID.me), complete Form 15620 in the IRS's mobile-friendly forms system, and download your confirmation. The online form currently supports a per-share price to four decimal places (e.g., $0.0001) and up to 99,999,999.99 shares.
• By mail. Send a signed paper Form 15620 by trackable mail (USPS Certified Mail with return receipt is the standard) to the IRS office where you file your tax return. Keep the stamped receipt — it's your proof you met the 30-day deadline. If your numbers exceed the online form's limits, mail is the fallback.

File using only one method. Submitting both online and by mail can create duplicates and processing delays.

4. Give a copy to your company

Even with electronic filing, you must provide a copy of the election to the company that issued the stock. The company needs it to report any income you recognize and, if you're an employee, to handle withholding. Send it to whoever manages your cap table.

5. Keep your own copy

Save the filed form, your mailing receipt or online confirmation, and a note of the dates. You'll want this proof years later at a financing or an exit. (As of the 2024 update to IRS Publication 525, you no longer have to attach a copy of the election to that year's tax return, but keeping your records is non-negotiable.)

A worked example: why the 30 days matter

Say you co-found a company and buy 1,000,000 shares of founder stock at $0.0001 per share — $100 total — with four-year vesting and a company repurchase right. The stock takes off, and the fair market value climbs to $2.00 per share by the time your shares fully vest.

With an 83(b) filed on time: You report the spread at transfer — $0, because you paid fair market value on day one. You owe nothing now. When you later sell, your entire gain is taxed as capital gains, measured from your $100 basis. Nothing is taxed as ordinary income.

Without an 83(b): Each year, as 250,000 shares vest, you recognize ordinary income on the difference between what you paid and the value at vesting. If the shares are worth, say, $2.00 when the final tranche vests, that's roughly $500,000 of ordinary income on that tranche alone — taxed at ordinary rates, often before you've sold a single share or seen any cash.

Same stock, same founder. The only difference is a one-page form filed inside a 30-day window. That's why the deadline is worth treating as sacred.

Common mistakes that cost founders the benefit

• Counting from the wrong date. Founders assume the 30 days run from when they sign or when shares appear in Carta. The clock usually starts at the board's grant/transfer date — often earlier than you think.
• Assuming options need an 83(b). Plain unexercised options don't. You only have something to elect on once you own stock that still vests — which is why early exercisers file and ordinary option holders don't.
• Trying to file for RSUs. RSUs aren't "property" until they settle, so 83(b) doesn't apply. Don't waste the effort.
• Filing late and hoping. There is no late 83(b). If the deadline passes, it's gone — plan the filing the same week you get the stock.
• Forgetting the company copy. The election can be valid and still create a withholding mess for your company if you never send them a copy.

How Afternoon helps

Afternoon keeps your startup's tax calendar — including one-shot deadlines like the 30-day 83(b) window — tracked alongside your books, so a six-figure tax decision doesn't slip because nobody owned the date.

FAQ

What happens if I miss the 83(b) deadline? You can't file late, and the IRS won't grant relief. You default to being taxed as the stock vests, on its value at each vesting date, as ordinary income. The only "fix" is avoiding it in the first place.

Do I owe any tax when I file the 83(b)? Only on the spread between what you paid and the fair market value at transfer. For most founders buying stock at incorporation, that spread is zero, so filing costs nothing in tax — it just locks in the low basis.

Do I need an 83(b) for stock options? Not for ordinary options you haven't exercised. You'd file one only if you early-exercise options into actual stock that's still subject to vesting.

Can I file the 83(b) election online now? Yes. Since 2025 you can file Form 15620 through your IRS Online Account, which the IRS lists as its preferred method. Paper filing by trackable mail still works.

Does an 83(b) election help with QSBS? Indirectly — filing starts the clock on owning the stock, which matters for long-term capital gains and for the holding-period rules under qualified small business stock. See our QSBS guide below.

Related reading

• QSBS Explained: How Founders Can Pay $0 Tax on Startup Gains
• The Cleanest Way to Set Up Your Startup's Legal + Tax Stack (First 90 Days)
• The 12 Biggest IRS and State Tax Deadlines Startups Miss

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This article is general information, not tax or legal advice. Rules change and your facts matter. Confirm specifics with a qualified professional or talk to Afternoon before you file or register.