To file an 83(b) election, you complete IRS Form 15620 or draft a written statement containing the items required by Treasury Regulation 1.83-2(e), mail the signed original to the IRS service center where you file your federal income tax return, and deliver a copy to your employer. All of that has to happen within 30 days of the date the restricted stock or early-exercised shares were transferred to you. The deadline is absolute, so the practical question of how to file an 83(b) election is really a question of how to do it quickly and with proof.
The 30-Day Clock
The 30 days run from the date the property was transferred to you. For a restricted stock award, that is almost always the grant date. For early-exercised stock options, it is the exercise date. The clock does not start when the shares vest, when you countersign the grant paperwork, or when you first hear about the election.1Office of the Law Revision Counsel. 26 USC 83 – Property Transferred in Connection With Performance of Services
One narrow exception: if the 30th day lands on a Saturday, Sunday, or legal holiday, the deadline rolls to the next business day.2Office of the Law Revision Counsel. 26 U.S. Code 7503 – Time for Performance of Acts Where Last Day Falls on Saturday, Sunday, or Legal Holiday Beyond that, there is no extension and no late-filing relief. Miss the window and the election is simply gone.
Treat the election as irrevocable from the moment you mail it. The IRS allows revocation only if you made the election under a genuine mistake of fact about the underlying transaction, and the request has to come within 60 days of discovering the mistake.3eCFR. 26 CFR 1.83-2 – Election to Include in Gross Income in Year of Transfer A later drop in the stock price does not qualify. Second thoughts about the tax math do not qualify. You can withdraw the election before the 30-day window expires, and that is it.
Information You Need Before You Draft
Treasury Regulation 1.83-2(e) spells out what the election statement must contain. Collect all of it before you start writing anything up:3eCFR. 26 CFR 1.83-2 – Election to Include in Gross Income in Year of Transfer
- Your full legal name, current mailing address, and Social Security Number or ITIN.
- The exact number of shares and class of stock you received.
- The date the property was transferred to you, and the taxable year for which you are making the election.
- The nature of the vesting restrictions on the shares.
- The fair market value of the property at the time of transfer, determined without regard to restrictions that will eventually lapse.
- The amount you paid for the property, if anything.
- A statement confirming you have furnished copies of the election to your employer and any other required parties.
For startup stock, the fair market value usually comes from the company’s most recent 409A valuation. If you are not sure what number to use, ask the company’s finance team or outside counsel for the current 409A price per share before you file.
Form 15620 or a Written Statement
You have two options for the document itself. The first is IRS Form 15620, a one-page standardized form the IRS introduced specifically for Section 83(b) elections.4Internal Revenue Service. Form 15620 – Section 83(b) Election The second is your own written statement that satisfies Treasury Regulation 1.83-2.5Internal Revenue Service. Update to the 2024 Publication 525 for Section 83(b) Election Both are equally valid.
Form 15620 is the easier path for most filers because it prompts you through every required field and makes it harder to leave something out by accident. If you draft your own letter, it must identify itself as an election under Section 83(b) of the Internal Revenue Code and include every item from the regulation. Sign and date whichever version you use.
Calculate the income you are electing to recognize by subtracting whatever you paid for the stock from its fair market value at the time of transfer. That difference is the ordinary income amount. For founders receiving shares at the 409A price shortly after incorporation, this number is often zero or close to it.
If you are married and live in a community property state, consider having your spouse sign as well. Community property rules can create ambiguity about ownership of the shares, and a spousal signature removes the issue.
Mailing the Election to the IRS
The IRS currently accepts 83(b) elections only by mail. Send the signed original to the IRS service center where you file your federal income tax return.4Internal Revenue Service. Form 15620 – Section 83(b) Election The correct address depends on the state where you live and appears in the Form 15620 instructions and on the IRS website.
What matters for the deadline is the postmark date, not the date the IRS receives the envelope. Under Section 7502, a timely postmark counts as timely filing.6Office of the Law Revision Counsel. 26 U.S. Code 7502 – Timely Mailing Treated as Timely Filing and Paying You need to be able to prove that date if the IRS ever questions the filing, so the mailing method matters.
USPS Certified Mail with Return Receipt Requested is the standard choice. The certified mail receipt carries the postmark date, and the green return receipt comes back signed by someone at the IRS. Keep both. USPS registered mail provides equivalent proof.
You can also use an IRS-designated private delivery service from FedEx, UPS, or DHL, but only specific service tiers qualify.7Internal Revenue Service. Private Delivery Services (PDS) For FedEx, qualifying options include Priority Overnight, Standard Overnight, and 2 Day. For UPS, the list includes Next Day Air and 2nd Day Air. Regular ground shipping from any carrier does not count. Keep the tracking receipt and delivery confirmation if you go this route.
Mail the original signed document. Make at least two copies before it leaves your hands: one for your employer, one for your permanent records.
Sending the Copy to Your Employer
Filing with the IRS is only half the requirement. You also have to send a copy of the election to the person for whom you performed the services (usually your employer) within the same 30-day window.3eCFR. 26 CFR 1.83-2 – Election to Include in Gross Income in Year of Transfer The company needs the election for its own tax reporting. The income you recognize will typically show up on your Form W-2 for the year.
Deliver the employer copy in a way that creates a record. Email with a read receipt, hand delivery with a signed acknowledgment, or a timestamped upload to the company’s equity management platform all work. The point is being able to show both that you delivered it and when.
What to Keep
You no longer need to attach the election to your federal tax return. The IRS removed that requirement through final regulations in 2016.8Internal Revenue Service. Internal Revenue Bulletin 2016-33 You do still need to report the recognized income on your return for the year of the transfer.
Hold on to the following permanently, or at least until you sell the shares and the statute of limitations on that tax year closes:
- Your copy of the signed election (Form 15620 or written statement).
- Proof of timely mailing: the certified mail receipt with postmark date, or the private delivery service tracking receipt.
- Proof of delivery: the USPS return receipt card signed by the IRS, or the delivery confirmation from your private carrier.
- Proof of employer notification: the email read receipt, signed acknowledgment, or other delivery record.
- The 409A valuation or other documentation supporting the fair market value you reported.
These documents may sit untouched for years. When you eventually sell the shares, the IRS will want to see that your cost basis reflects the election. Without the paper trail, you can end up paying tax twice on the same income.
Before You File, Weigh the Risk
The biggest downside is forfeiture. If you leave the company before your shares vest, you lose the unvested shares, and the tax you paid on those shares when you made the election is gone. The statute explicitly denies a deduction for forfeited property when an 83(b) election was in place.1Office of the Law Revision Counsel. 26 USC 83 – Property Transferred in Connection With Performance of Services Your only deduction is limited to whatever you actually paid out of pocket for the shares, not the income you recognized.
If the stock drops in value instead of rising, you still owe tax on the grant-date value you already paid. You cannot claim a loss until you sell, and that loss is a capital loss subject to the standard annual limit of $3,000 against ordinary income ($1,500 if married filing separately), with the rest carried forward.9Internal Revenue Service. Topic No. 409, Capital Gains and Losses
The election works best when the current value is low and you are confident you will stay through vesting. Founders receiving shares at incorporation for fractions of a penny are the clearest case. A restricted stock award at a late-stage company with a high 409A carries real money at stake if the shares decline or you leave early.
If You Do Not Have a Social Security Number
Non-U.S. founders without a Social Security Number need an Individual Taxpayer Identification Number to file. Applying for an ITIN means submitting Form W-7 to the IRS with identity documentation, usually a passport or a certified copy from the passport-issuing authority. Applications are processed by mail and can take several weeks. The 30-day election deadline does not pause while you wait, so start the ITIN application the moment you receive your stock grant.