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Looks like eFunds is being bought by Fidelity, but none of the news reports seemed to say when the stock conversion will occur.

I agree with the foregoing that the bargain element, once the options are exercised, will be ordinary W2 income (subject to FICA tax). But keep in mind that if this transaction occurs this year, you folks will have an additional $9,400 (approx) in ordinary income. So you'll need to check with her employer to see if they will be withholding tax (Fed and State) as well as FICA tax on the transaction. Otherwise, you may wind up owning additional tax and perhaps a penalty when you file for 2007.

And retiring high-interest debt is ALWAYS a good idea....but only if you also modify any bad-spending habits :-)

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