You can wait for the price to rise before exercising the option, thus locking in a sure profit. You are taxed only when you ultimately sell the shares. To get gentle long-term gain treatment of any profit, you must not sell the stock until more than two years have passed since the option was granted and more than one year has passed since you exercised the option to buy the stock. To the extent that you get a break on the interest rate, though, the IRS says you have taxable income. Back to top Loans From Retirement Plans You may be able to tap a retirement plan without triggering a tax bill by borrowing from the plan.
Strict rules have to be followed, though.
Back to top Meals and Lodging Your employer can provide food and housing tax-free if specific conditions are met. Special rules apply to members of the clergy who are given a house or a housing allowance as part of their pay. That value is not taxable. Back to top Medical and Dental Insurance premiums paid by your employer for you and your family are tax-free, although it's possible that Congress will impose a limit on how much an employer can pay, with excess amounts considered taxable income to the employee. Included are such benefits as free space-available air or train travel for airline or railroad employees.