Question
Mark received 10 ISOs (each option gives him the right to purchase 14 shares of Hendricks Corporation stock for $9 per share) at the time
Mark received 10 ISOs (each option gives him the right to purchase 14 shares of Hendricks Corporation stock for $9 per share) at the time he started working for Hendricks Corporation five years ago when Hendricks's stock price was $5 per share. Now that Hendricks's share price is $35 per share, Mark intends to exercise all of his options and hold all of his shares for more than one year. Assume that more than a year after exercise, Mark sells the stock for $35 a share.
What are Mark's taxes due on the grant date, the exercise date, and the date he sells the shares, assuming his ordinary marginal rate is 32 percent and his long-term capital gains rate is 15 percent?
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