A stock option links two different decisions: acquiring shares and eventually disposing of them. The money needed to exercise is observable from the share count and strike, while the tax effect depends on dates, income, option type and disposition. This planner keeps those pieces separate so that an attractive paper spread is not mistaken for cash you can spend.

Start with the funding constraint
The first result is the deepest cumulative funding gap. A $1,000 exercise followed later by $500 of sale proceeds still required $1,000 at the beginning. The brief’s $5 downside exit therefore recovers only half the exercise cash before taxes. Other cash, borrowing, settlement delays and employer-provided cashless arrangements are not inferred.

Follow each share through two tax ledgers
The engine preserves regular and AMT bases for each ISO lot. Selling in the exercise year, retaining shares over year-end and making a later qualifying or disqualifying sale produce different events. Regular and AMT capital losses can then carry forward independently. This is why changing a sale date can matter even when the sale price is unchanged.

Read the comparison without treating it as an investment ranking
The holding comparison leaves stock unsold; the sale comparisons exchange it for cash. Cash-only outcomes do not include terminal market value of retained shares and are not directly comparable total wealth. The sensitivity curve varies a common exit price for one issuer and share class. It neither predicts price probabilities nor finds an optimal exercise strategy.

Verify personal facts and unsupported tax effects
Full-year baseline income and wages must exclude the modeled option events. Do not substitute year-to-date payroll totals. The basic standard deduction omits age, blindness and dependent adjustments; the model does not apply kiddie-tax or dependent-specific AMT limits. Entered deductions must be final fixed amounts. Credits, deduction phaseouts, AMT foreign credits, nonemployee compensation and unusual option arrangements are outside scope. A professional should reconcile the actual return and payment schedule.

Continue with the relevant standalone tools
For adjacent questions, open Capital Gains Tax Calculator, Stock Cost Basis Calculator, Emergency Fund Calculator, Quarterly Estimated Tax Calculator. These are separate tools; this planner does not transfer your inputs to them or certify their results.