Share Incentive Plan Calculator
Calculate the potential value of your employee stock options
Input Details
Results
Current Value
Total Value
$1,000
Gain Over Exercise
+$1,000
Projected Exit Value
Total Value
$10,000
Gain Over Exercise
+$9,000
Ownership
Equity Percentage
0.01%
Fully Diluted
0.01%
Vesting Schedule
Value Growth Projection
Growth Scenarios
Tax Considerations
ISO vs NSO
Incentive Stock Options (ISOs) offer potential tax advantages over Non-qualified Stock Options (NSOs). ISOs may qualify for capital gains tax rates if specific holding period requirements are met.
AMT Implications
Exercising ISOs may trigger Alternative Minimum Tax (AMT), especially if there's a large spread between exercise price and fair market value. Consult with a tax advisor before exercising options.
83(b) Elections
For restricted stock, filing an 83(b) election within 30 days of grant can potentially reduce tax liability by paying tax on the grant value rather than the higher vested value.
Disclaimer: This calculator provides general information and not tax or financial advice. Consult with a qualified professional regarding your specific situation.
Share Incentive Plans Guide
Key Terminology
Stock Options
The right to purchase company stock at a predetermined price (strike price) for a specified period of time.
Strike/Exercise Price
The fixed price at which stock can be purchased, typically set at the fair market value when granted.
Vesting
The process by which employees earn the right to exercise their stock options over time.
Cliff Vesting
A period at the beginning of employment where no options vest until the cliff date is reached.
Dilution
The reduction in ownership percentage that occurs as more shares are issued by the company.
Understanding Your Share Options
Value Calculation
The value of your options is the difference between the current share price and your strike price, multiplied by the number of shares.
Tax Implications
Different types of options (ISO vs NSO) have different tax treatments. Consult a tax professional for advice specific to your situation.
Typical Vesting Schedules
A common structure is a 4-year vesting period with a 1-year cliff, followed by monthly or quarterly vesting thereafter.
Exercising Options
When you exercise options, you pay the strike price to convert your options into actual shares. This can have immediate tax implications.
How to Use This Calculator
- Input your grant details: Enter the number of options/shares you've been granted and their strike price.
- Enter current and projected share prices: Use your company's current valuation and your expectations for future growth.
- Set vesting parameters: Enter your vesting period length, cliff period, and vesting frequency.
- Check the results: See your current and projected values, vesting schedule, and ownership percentage.
- Explore scenarios: Use the Advanced Analysis tab to model different growth scenarios.
Pro Tip: When evaluating a job offer with equity compensation, consider both the number of shares and what percentage of the company they represent. A larger number of shares in a company with more outstanding shares could be less valuable than fewer shares in a company with fewer outstanding shares.