Updated December 2025

The 83(b) Election: Start Your QSBS Clock Years Earlier

Filing an 83(b) election within 30 days of receiving restricted stock starts your QSBS holding period at grant—not vesting. On a 4-year vest, that's potentially 4 years of head start.

Miss the 30-day window, and there's no second chance.

Check Your 83(b) Deadline

Enter when you received your restricted stock to see your 30-day filing deadline.

When did you receive restricted stock?

Use the date you signed the restricted stock agreement or received the grant.

The Timeline Difference

With 83(b) filed:

2021: Receive restricted stock, file 83(b) ← CLOCK STARTS

2022-2024: Stock vests over time

2026: 5 years complete ← QSBS QUALIFIED

Without 83(b):

2021: Receive restricted stock (clock doesn't start)

2022-2024: Stock vests over time

2025: Final vest ← CLOCK STARTS HERE

2030: 5 years complete ← QSBS QUALIFIED

Same stock. Same company exit. But the 83(b) filer qualifies for QSBS 4 years earlier.

How to File an 83(b)

The process is surprisingly low-tech. There's no electronic filing—you mail paper to the IRS.

Complete the 83(b) form

Include your name, SSN, address, property description, FMV, amount paid, and a statement that you're making the election under Section 83(b).

Mail to IRS within 30 days

Send to the IRS Service Center where you file your return. Use certified mail with return receipt requested. The postmark date is what counts.

Give a copy to your employer

They need to know you filed. This also helps if you ever need proof.

Keep records forever

Keep your signed copy, certified mail receipt, and return receipt. You may need these years later to prove you filed.

The 30-day deadline is absolute. Day 31 is too late. There is no extension, no exception, no remedy. If you miss it, your holding period starts at vesting.

When You Can (and Can't) File 83(b)

Stock Type	83(b) Available?	Holding Period Starts
Restricted stock	Yes	Grant date (with 83b) or vesting (without)
Early-exercised options	Yes	Exercise date (with 83b) or vesting (without)
Regular ISOs/NSOs	No	Exercise date only
RSUs	No	Vesting/delivery date only

The key distinction: 83(b) only applies when you receive actual stock that's subject to vesting. RSUs don't count because you don't have stock until they vest. Regular options don't count because you don't have stock until you exercise.

The Tax Trade-off

When you file an 83(b), you pay income tax on the current value of the stock immediately—even though you haven't sold anything.

The bet you're making:

•Pay tax on $1/share now at ordinary income rates
•Stock grows to $100/share
•Sell with QSBS exclusion on the $99 gain = $0 tax on the appreciation

The risk: If the company fails or the stock becomes worthless, you paid tax on something you never benefited from. You can deduct the loss, but you don't get the tax back.

This trade-off is why early-stage employees often file 83(b)—the stock is worth almost nothing at grant, so the immediate tax is minimal. At a later-stage company with higher valuations, the calculus is different.

When Will You Qualify?

Enter your stock details to see when your QSBS holding period started—and when you'll hit 5 years.

QSBS Savings Calculator

Estimate your Section 1202 tax savings in 60 seconds

Your Stock

Stock Type

How Acquired

Key Dates

Your holding period starts at EXERCISE, not grant. This is the #1 mistake people make.

Grant Date

Exercise Date *

Expected Sale Date *

Value

Cost Basis *

What you paid, or the value included in your income

Expected Sale Value *

Your Location

State of Residence *

Your state at time of sale determines tax treatment

Common 83(b) Mistakes

Missing the deadline

Mark day 30 on your calendar the moment you receive restricted stock. File on day 25 to be safe.

Not using certified mail

Without proof of mailing date, you can't prove you met the deadline. Certified mail with return receipt is essential.

Losing your records

You may need to prove you filed 10+ years later when you sell. Keep everything—digitally backed up.

Assuming your company filed for you

Some companies help, but it's your responsibility. Verify it was actually sent.

What If I Already Missed the 30-Day Deadline?

There is no extension. No exception. No fix. If you received restricted stock more than 30 days ago and didn't file an 83(b), your QSBS holding period starts at vesting, not grant.

What this means:

• 4-year vesting schedule = your clock started when shares vested
• Each vesting tranche has its own separate holding period
• Your earliest shares might qualify before your latest shares

Example with 4-year vest, 1-year cliff:

Granted: Jan 1, 2020

Cliff vests (25%): Jan 1, 2021 → qualifies Jan 2, 2026

Monthly vests continue...

Final vest: Jan 1, 2024 → qualifies Jan 2, 2029

What you CAN do:

• Calculate each tranche separately — know exactly when each portion qualifies
• Consider selling in tranches — sell qualified shares while holding the rest
• Plan around your dates — if a liquidity event is coming, know which shares will qualify

In the calculator below, enter your vesting date (not grant date) to see when your shares will qualify.