What should I do if I miss my 83(b) election deadline?
We strongly recommend that you consult a good startup attorney with expertise advising startups on managing the consequences of a missed 83(b) election deadline. We recommend doing this as soon as possible, because the consequences of a missed 83(b) election deadline worsen with each vesting period and with increases in the value of the shares.
Navigating this process can be complicated and requires careful expert analysis. Hopefully, your attorney will be able to propose ways to mitigate the missed 83(b) election deadline. This can be tricky because many of the more obvious solutions run a risk of being disregarded or recharacterized by the IRS under its "sham transaction" doctrine, or have other similar issues. The availability of some approaches may also depend on prompt action, which is another reason we recommend consulting with an attorney as soon as possible.