Potential loss on exercise of stock options
I realize this is not an IRA question, but am seeking input for a client. On April 20, 1999 she was awarded 3,821 exercisable stock grants to be exercised by April 20, 2009. These stock grants are in a financial institution stock that has been killed during the downturn of that sector. It is currently trading in the $10-$12/share range and may go a little higher by the end of the exercise period. The strike price, unfortunately, is $29.15/share. Can anything be done, and what, given this scenario, to gain some tax advantage for the client?
Thanks to all who may know the answer.
Permalink Submitted by mk foss on Tue, 2009-03-10 01:03
There’s nothing than can be done right now.
If she exercised them and sold them the same day, she’d be out of pocket some $$ and also have potentially a capital loss. Ordinarily companies will reprice options when they’re underwater or they will lapse because it doesn’t make economic sense to exercise.