Tax election
Also called: equity tax election
ELI5
A tax choice that can affect how share awards are taxed.
Used in conversation
“The company cannot give personal tax advice on the tax election.”
Definition
An election made under tax law affecting treatment of equity, such as a US 83(b) election.
Here “Tax election” means: An election made under tax law affecting treatment of equity, such as a US 83(b) election.
Pitch context
You will see “Tax election” in fundraising decks, data rooms, term sheets and investor conversations when the discussion reaches founder & employee equity.
Why it matters: In founder & employee equity, a loose definition can change rights, obligations, approval, disclosure or enforceability.
Caution
Meaning, enforceability and required process vary by jurisdiction and agreement; this definition is not legal advice.
Sources & evidence · 5
Direct term-level sources and supporting source families.
- National Venture Capital Association — Model Legal DocumentsDirect source · institutional · checked 2026-08-16
- U.S. Securities and Exchange Commission — Small Business Capital Formation GlossaryDirect source · primary · checked 2026-08-16
- U.S. Securities and Exchange Commission — Exempt OfferingsSupporting source family · primary · checked 2026-08-16
- Y Combinator — Safe financing documentsSupporting source family · practitioner · checked 2026-08-16
- Y Combinator — Series A Term Sheet TemplateSupporting source family · practitioner · checked 2026-08-16