Some entrepreneurs consider 409A valuations a necessary evil. But too many aren’t particularly familiar with this particular section of the corporate tax code. And while we realize tax law might not be red-hot cocktail party conversation, it’s something that should be top of mind for start-up owners.
409A valuations are most commonly performed to assist companies with setting the strike price for their employee stock options, which needs to be at or above fair market value. The most common questions surrounding those are: “Do I really need a valuation?,” “How do I select an appraiser and why does it cost so much? “ and our personal favorite “Why is my common stock worth so much?”
To read the full, original article click on this link: Why you should care about 409A valuations | VentureBeat
Author: Petra Loer and Kurtis Handa
