The 83(b) election: 30 days, no extensions, no second chances

When a founder or employee receives stock that vests over time, the default tax rule is unforgiving in a rising company: you are taxed as each tranche vests, at whatever the stock is worth then. A Section 83(b) election flips that. You elect to be taxed now, on the value at grant, and all later appreciation becomes capital gain instead of ordinary income.

What the election actually does

Without the election, restricted stock is taxed under Section 83(a) as it vests — ordinary income on the spread at each vesting date, which for a startup that grows can mean large tax bills on stock you cannot sell. With the election, you include the value at transfer (minus anything you paid) in income immediately. If you paid fair value for the shares — common for founder stock bought at incorporation — the income inclusion is zero, and the election costs you nothing while starting your capital-gains holding period on day one.

The deadline is 30 days and it is absolute

The IRS's own form states it directly: an 83(b) election must be filed no later than 30 days after the date the property was transferred. If the 30th day lands on a weekend or legal holiday, the deadline rolls to the next business day — that is the only relief that exists. There is no extension, no reasonable-cause exception, and no fixing it later. Miss the window and you are back on the default vesting-date taxation, permanently, for that grant. Source: IRS Form 15620 and its instructions, irs.gov.

Form 15620 standardized the mechanics

For decades the election was a self-drafted statement, which meant self-drafted mistakes. The IRS now publishes Form 15620, a standardized Section 83(b) election form. Per its instructions, the completed and signed form is submitted to the IRS office where the person who performs the services files their federal income tax return, and a copy must also go to the employer (and to the transferee of the property, if different). Follow the current form's instructions on where and how to submit — that is the authoritative source, and it changes more often than blog posts do.

The downside, stated honestly

The election is a bet that the stock keeps its value. If you elect, pay tax on value at grant, and the company later fails or your unvested shares are forfeited, you generally do not get that tax back as a loss deduction on the forfeited compensation income. The election makes sense most often when the value at grant is low — which is exactly why it is a day-one decision, not a year-two one.

For the company: this is also your problem

The company's payroll and equity records need to know who elected, because the election changes when compensation is recognized and what appears on the employee's W-2. A grant tracker that records the election date next to the grant is not bureaucracy — it is what makes the next audit and the next financing diligence quiet.

Sources. IRC Section 83(b); IRS Form 15620, Section 83(b) Election, and its instructions (irs.gov, fetched August 2026). This article is general information, not tax advice — deadlines and mechanics should be confirmed against the current IRS form before relying on them.