Capital Gains and Capitalization Table

Introducing the Cap Table and Hiring the CTO

Feld Thoughts

SEPTEMBER 2, 2011

Later, if they sell, the low tax basis and capital gains tax rates result in a lower tax liability than if they didn’t file the 83(b) election. Rather, it gets recorded in a document called the Capitalization Table (or “Cap Table”), which shows the ownership stake each person or entity has in the business.

Cap Table

Cap Table CTO Hire Technical Cofounder Cofounder

Startup Equity For Employees

www.payne.org

SEPTEMBER 22, 2011

Owning the stock has a potentially significant tax advantage: it starts the timer for long-term capital gains. Any capital asset held for more than a year is taxed a low, long-term capital gains rate (currently 15% percent, maximum).

Equity

Equity Employee Vesting Preferred Stock

StartUpRoar

Introducing the Cap Table and Hiring the CTO

Startup Equity For Employees

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