Hi,<p>tldr; got in early at a startup. exercised stock for ~$6k. got valued at ~$90k+, received a 1099 for that. company subsequently declined in value, now the stock might never be worth anything, but I owe $30k in taxes.<p>I was a very early contract hire at a startup right around pre-covid. Rode the unicorn wave to a $1b+ valuation. Good ARR. Everything going well. I exercised some stock options after they vested for around $6k. I did not pay any taxes at the time. It was through Carta. It never asked me to pay taxes on it or anything. At the end of the year, I get a surprise 1099 from the startup stating I made ~$90k+. Of course it was just paper stock gains (of private shares).<p>There was no way to sell the privately-held shares. I tried sites like Forge Global but there was zero market for these.<p>Subsequently, some things happened that I won't get into, but the company declined in value. I have no idea what it's worth today, but it's highly unlikely that it is worth anywhere near $1b anymore.<p>I am finally trying to figure out a better solution to the whole situation. I've contacted tax attorneys and CPAs. One guy said there _might_ be something I could do if I could show the current valuation of the company had declined starkly in value, compared to the value I was assessed the gains at.<p>Anyone in a similar boat?<p>I feel like this is an un-talked about thing in the startup world. It really sucks tbh.<p>Also note: I am not some big FAANG guy with $300k+ in TC that I pay taxes on each year. I won't say how much I make but it is a small fraction of that, so simply "depreciating" (?) or whatever the shares would not help me very much in this situation. That is--I hardly make enough in income each year to "save" in unpaid taxes if I take a giant loss from the shares, and hence just pay less in taxes going forward. I'm trying to figure out a way to reduce the $30k overall burden that I'm paying, not just reduce my future tax obligations. But maybe I'm missing something.
The income has already been realized.
Talk with a tax professional, it will be worth the 1-2 hours of time and that cost. Worst case, they confirm the bad news and you need an installment plan.<p>You want a tax professional who is knowledgeable around this specific tax treatment. Get a referral from someone you trust if you can.<p><a href="https://www.latimes.com/archives/la-xpm-2000-dec-22-fi-3328-story.html" rel="nofollow">https://www.latimes.com/archives/la-xpm-2000-dec-22-fi-3328-...</a> (Echos of 1999-2001)