During 2016, Ms. Jennifer Maxwells joined as a Vice President of Raven Ltd., and she was granted the stock options that allowed her to acquire 12,000 shares of the Company's common stock at a price of $22 per share. At this time, the shares have a fair market value of $20 per share.
On June, 1, 2020, Ms. Maxwell exercises all of these options. Currently, Raven Ltd. shares have a fair market value of $31 per share.
On January 31, 2023, Ms. Maxwell sells the 12,000 Raven Ltd. shares at a price of $28 per share

 

Required: Calculate the tax consequences of the transactions that took place during 2016 to 2023 separately. Please provide all the details for each scenario.
Case A Raven Ltd. is a public company.
Case B Ravan Ltd is a public company and granted her stock options that allowed her to acquire 12,000 shares of the Company's common stock at a price of $24 per share.
Case C Raven Ltd. is a Canadian controlled private corporation.

Answer rating: 100% (QA)

Case A Raven Ltd is a Public Company Grant Date 2016 No tax implications occur upon granting stock options as Ms Maxwell only gains the right to buy t... View the full answer