83(b) Election Cover Letter Template for Startup Founders
last updated: Apr 23, 2026
Filing an 83(b) election is a mandatory chore for every new founder. Use my exact cover letter template below to notify the IRS and lock in your tax basis before your company valuation climbs.
TL;DR
An 83(b) election cover letter accompanies your IRS form to prove you filed within the strict 30-day window. It is the receipt that saves your equity if the IRS ever questions your timeline.
- Benchmark: You lock in a 15-20% long term capital gains tax rate instead of paying higher ordinary income taxes later.
- Rule: Always send this packet via USPS Certified Mail with a return receipt requested.
- Warning: The IRS does not care if your local post office made a mistake. Missing the rigid filing window makes the tax election permanently invalid.
Glossary
- Section 83(b): A provision in the internal revenue code allowing founders to pay taxes on the total fair market value of restricted stock at the time of granting.
- Certified mail: A postal service providing the sender with a mailing receipt and electronic verification that an article was delivered to the government.
- Fair market value: The current price of your company shares (which is usually fractions of a penny when you first incorporate).
How to file the 83(b) election
Follow the steps below to use the template. I strongly advise you to consult a legal advisor or CPA before mailing official tax documents. You can review the step-by-step process in the 83(b) election startup guide to avoid catastrophic tax mistakes.
Cover letter template
Copy this text directly into your word processor.
[Your Name]
[Your Address]
[City, State ZIP]
[Your SSN]
[Date]
Internal Revenue Service
[Address of your regional IRS processing center]
Re: Section 83(b) Election for [Your Name]
Dear Sir or Madam:
Enclosed please find an original and one copy of the election under Section 83(b) of the Internal Revenue Code of 1986, as amended, filed by [Your Name] with respect to [Number of Shares] shares of common stock of [Company Name], Inc.
Please acknowledge receipt of this election by stamping the enclosed copy of this letter and returning it to me in the self-addressed, stamped envelope provided.
Very truly yours,
___________________________
[Your Name]
Enclosures:
1. 83(b) Election Form (Original and 1 copy)
2. Self-addressed stamped envelope
- Draft the letter: Copy the text block below into your word processor and replace all bracketed fields.
- Prepare the copies: Print the cover letter and your 83(b) election form. You need to include an original and a duplicate.
- Mail the package: Send the packet via USPS Certified Mail to the IRS processing center for your specific state.
Cover letter template
Copy this text directly into your word processor.
[Your Name]
[Your Address]
[City, State ZIP]
[Your SSN]
[Date]
Internal Revenue Service
[Address of your regional IRS processing center]
Re: Section 83(b) Election for [Your Name]
Dear Sir or Madam:
Enclosed please find an original and one copy of the election under Section 83(b) of the Internal Revenue Code of 1986, as amended, filed by [Your Name] with respect to [Number of Shares] shares of common stock of [Company Name], Inc.
Please acknowledge receipt of this election by stamping the enclosed copy of this letter and returning it to me in the self-addressed, stamped envelope provided.
Very truly yours,
___________________________
[Your Name]
Enclosures:
1. 83(b) Election Form (Original and 1 copy)
2. Self-addressed stamped envelope
Benchmarks
Sample math: If you receive 1,000,000 shares at a valuation of $0.001 per share, your initial taxable basis is $1,000. Paying taxes early at an estimated ordinary income rate of 30-35% costs you roughly $300 to $350 today. If you skip this letter and the shares vest when the company is worth $10 per share, you will owe massive ordinary income tax on millions of dollars instead of a few hundred bucks. Prepare your early foundation accurately with the 83(b) election pre-seed guide.
83(b) election vs. standard vesting
Standard vesting events trigger taxable income every time a new tranche of shares unlocks. Because a healthy startup grows in value, your tax burden scales aggressively as your valuation climbs. The 83(b) election fundamentally changes this mechanic by moving your entire tax obligation to the grant date. You lock in taxes based on the absolute lowest company valuation, sacrificing a few hundred dollars today to protect millions later.
Risks
The IRS rigidly enforces the 30-day filing window. If you miss this deadline, your election is voided permanently. Furthermore, losing the physical return receipt leaves you defenseless during an audit. Treat this receipt like cash. Make sure your co-founders also comply, and use the 83(b) election startup script to ensure nothing slips through the cracks.
Will filing your 83(b) election get you to $10K MRR?
Mastering your 83(b) paperwork protects your personal wealth, but it will not magically generate revenue. File this form flawlessly today, secure your stamped receipt, and immediately shift your focus back to building a product people want. Tactics without strategy are completely worthless — put the letter in the mail, stop pretending to be a lawyer, and get back to booking sales calls to hit your $10K MRR. Fix your foundation before you launch.
FAQ
- You:How many days do I have to mail the 83(b) election?Guide:You have a strict deadline of under 30 days from the date your restricted stock is granted to file the election with the IRS. There are absolutely no extensions granted for this timeframe.
- You:Do I need to include a self-addressed stamped envelope?Guide:Yes. The IRS uses the envelope to mail back your date-stamped cover letter. This returned copy serves as your permanent proof of filing.
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