A stock option that offers a potential capital-gains tax break if you hold the stock at least one year from the date of purchase and two years from the date of grant. Although these options, called ISOs, don't always trigger income tax when you buy the stock, you will tangle with the Alternative Minimum Tax if you hold the stock into the next calendar year.
The most common type of stock option. Exercising these options immediately triggers income tax on the initial spread between what you paid and what the stock was worth the day you bought it. If you hold the stock at least a year, an increase in value beyond the initial spread would be taxed as a long-term gain.
The day the company gave you options.
The discounted price you can pay to buy the stock for the life of the option. Sometimes referred to as "exercise price" and "strike price."
The day you plunk down cash and actually buy the stock.
The difference between your grant price and the market price of the stock on the day you exercise your options. The spread is taxed differently depending on whether you exercised ISOs or non-qualified options or buy ESPP stock.
A sale before you have held the stock one year from the date of exercise and two years from the date of grant. These holding periods apply to ISOs and ESPPs but not to non-qualified options.