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This doesn't seem right:

I leave a private company and exercise 10,000 vested ISO shares for $2 ea. ($20,000 investment)

The company goes public at $15 and then plummets to $1, before everyone's 6 month lockup period expires.

The company sends a snickering note that sez the stock was worth $15 when they "transferred" it to me, therefore, I owe the IRS
tax on $150,000-$15,000 or $135,000 that I never saw because (1) I was prohibited from selling them by the lockup period when
they were "worth" something, and (2) even if you did, I'd lose $10,000 of the initial investment because they are now worth 1/2
what I paid for them.

So do I really have to pay the tax on the $135,000 difference in "value" even though I didn't sell it? Sure I could pay this and then get it back next year if I actually do sell it for a loss, but that means I have to give the govm't about $30,000 for a year that I never actually had!!!!

Is this right?

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