The IRS has provided sample language (Rev. Proc. 2012-29) that
may be used (but is not required to be used) for making an election
under Section 83(b).
Section 83 provides rules on the recognition of income when
property (e.g., stock) is transferred to a service provider in
connection with the performance of services. In general, Section 83
provides that the service provider recognizes income in the first
taxable year that the property has been transferred to the service
provider and the property is either transferrable or not subject to
a substantial risk of forfeiture (i.e., the property is vested).
For example, if an employee receives nonvested stock from an
employer, the employee recognizes compensation income in the first
year that the stock becomes vested, and the amount of income is
equal to the fair market value of that stock on the vesting date,
less the amount the employee paid, if any, for the stock.
