What tax rules apply when an option does have a readily ascertainable fair market value at the time of the grant? (1) the option is taxed based on the difference between the stock price and the option's value at the time of the grant (2) the option is taxed at the time of the grant (3) the employer receives a tax deduction at the time of the grant (4) the employee has no further taxable compensation income when the option is exercised

Question options:

a) (1) and (3) only

b) (1) (2) (3) and (4)

c) (1) (2) and (3) only

d) (2) (3) and (4) only