Laura Moreno

Creating an LLC:

This doesn't automatically generate tax deductions or savings. Self-employed individuals can claim legitimate business expenses on Schedule C, with or without an LLC. The business structure itself doesn't increase available deductions.

Why Startup Fundraising Rounds Are Priced Differently from 409A:

Fundraising rounds are priced higher due to preferred shares' rights. 409A valuations focus on common stock FMV, leading to lower valuations and cheaper exercise prices for employees. Values align at IPO/exit.

Fun tax fact:

Pennsylvania stands alone in treating ISOs as NSOs for state tax purposes. PA residents face immediate taxation at exercise, while all other states follow federal ISO treatment.

QSBS Tips for Startup Founders:

QSBS should be top of mind. It can mean 0% federal tax on up to $10M in gains but need to be prepared from the start

RSUs:

Taxed when they vest and not when granted

Should You Early Exercise Your Startup Options:

From a tax perspective, early exercise is great, but you will need to afford the cash to cover it. You also need to be prepared that this is a high risk decision and you might not get the money back for a long period of time.

Laura Moreno here - co-founder @haventax_. We handle tax planning and filing for the tech community. Here to share a ton of tax advice and to help however I can. DMs are open.