A Section 83(b) election is a letter submitted to the IRS by an individual who wishes to have their startup stock taxed at the time of purchase rather than at the time of vesting. By making this election, individuals can potentially save a significant amount on their future taxes. Instead of paying taxes when the stock vests, which is often monthly, individuals choose to pay minimal or no taxes at the time of stock purchase and defer taxes until they sell the stock. It is important to make this election within 30 days of stock issuance, counting every calendar day, including weekends and holidays.

Making a Section 83(b) election is often recommended, especially if founders or employees expect the value of their stock to increase and plan to remain employed with the company until their stock vests. This election allows founders to avoid owing substantial taxes each time their stock vests and instead pay taxes only when they sell the stock. However, it is essential to consult with a tax advisor and consider individual circumstances before deciding whether to make a Section 83(b) election.

Additionally, if an individual is not a US taxpayer and has no intention of becoming one, filing a Section 83(b) election would not provide any benefit. Each founder needs to make their own decision and file the election individually, although future investors may expect all co-founders and employees to have made the election.

Please note that this information is a brief summary and should not be considered as tax advice. It is important to consult with a qualified tax professional for personalized guidance regarding Section 83(b) elections and their implications.