Plan your Cursor NSO exercise
Calculator · free · no signup · pre-IPOCursor is pre-IPO. Plan your NSO exercise tax (federal, state, FICA) at any expected valuation.
Beta · invite-only · AlphaLatitude Inc. · Free Tools
Your grant
Seeded from secondary-market data, as of Jun 11, 2026
Tax inputs
Hold strategy
Best after-tax payout — at year 1
$3,034,841
Sell + invest wins by $2,852,723 over Hold 1 yr.
Estimates only. Not financial advice.
Sell + invest
Best payout| Bargain element (sale − strike) | $5,922,750 |
| Federal | |
| State | |
| Medicare | −$85,880 |
| Additional Medicare | −$53,305 |
| Market gain over 1 yr at 10.0% | $283,266 |
| LTCG on diversified gain (fed + state + NIIT) | −$81,091 |
| Net at year 1 | $3,034,841 |
Sell every share immediately; invest the after-tax cash at the market return for 1 yr, then liquidate. Diversified — no single-stock concentration risk.
Exercise + hold 1 yr
| Sale proceeds (year 1) | |
| LTCG tax (federal + state + NIIT) | $0 |
| Net at year 1 | $182,118 |
Sold 2,629 shares at exercise to cover strike + tax; 2,371 shares held 1 yr for LTCG.
Social Security + Medicare are payroll taxes (collectively called FICA) — they apply because you're exercising as a current employee.
Both columns are stated in year-1 dollars: sell-now proceeds compound at the market return and pay LTCG on the gain at year 1; any cash paid out of pocket on the hold side carries the same opportunity cost.
Net at year N — by hold period
Estimates only. Excludes AMT (NSOs do not trigger AMT), state-AMT, multi-state moves, and disqualifying-disposition edge cases. Not financial advice.
You calculated one NSO decision. The beta plans NSOs alongside RSUs and ISOs in a single multi-year tax plan.
Request beta access →About Cursor
Cursor is a privately held Dev Tools company, incorporated in Delaware and headquartered in San Francisco, CA.
Last reported secondary-market price: $1,194.55 per share (as of 2026-06-11). Your own 409A may differ.
$1.2B ARR; AI code editor.
Equity grants at Cursor typically include incentive stock options (ISOs) and non-qualified stock options (NSOs).
Anysphere, Inc., doing business as Cursor, is an American software company that develops Cursor, an AI coding agent and software development environment. Founded in 2022 and headquartered in San Francisco, the company builds tools and models that allow users to edit code, search codebases, run terminal commands, and complete programming tasks using natural-language instructions. By early 2026, Cursor had reached a valuation of US$29.3 billion and surpassed $3 billion in annual recurring revenue.
Source: Wikipedia (CC BY-SA 4.0)
Four MIT friends, Michael Truell, Sualeh Asif, Arvid Lunnemark, and Aman Sanger, founded Anysphere in 2022 and shipped Cursor, an AI-native code editor, in March 2023. Cursor embeds large language models directly into the editing experience, letting developers write, explain, and refactor code through natural language alongside their existing workflow. The company reached $1 billion in annualized revenue by November 2025, the fastest B2B software company to hit that milestone, and closed a $2.3 billion Series D that month at a $29.3 billion valuation.
Sources: en.wikipedia.org · cnbc.com
Equity comp at Cursor
- Likely uses ISOs and NSOs rather than RSUs at the current stage (founded 2022, on the order of 50 to 300 employees as of late 2025, no public IPO plan). Rapid valuation escalation (Series B around $400M August 2024, Series C $9.9B June 2025, Series D $29.3B November 2025) creates significant 409A overhang and AMT exposure for option holders, since each step-up resets the strike price for new grants.
Sources: en.wikipedia.org · techcrunch.com
Researched 2026-05-11.
OptionsAhoy is an independent tool and is not affiliated with, endorsed by, or sponsored by Cursor.
Cursor NSO exercise creates ordinary income on the bargain element (federal, state, and FICA) at the price on the day you exercise. The calculator works at any valuation, so you can model your exercise cost at the current 409A FMV, an expected IPO price, or post-IPO scenarios.
Example: at Cursor's last reported price of $1,194.55, exercising 5,000 NSOs with a $358.37 strike creates a $4,180,900 bargain element, taxed as ordinary income on the day you exercise. Combined federal + state + FICA on that bargain typically lands between $1,128,843 and $1,881,405 depending on your bracket and state. The calculator above computes the exact figure for your situation and compares selling now vs. holding through the long-term capital-gains threshold.
All Cursor tools → · Use the generic NSO Exercise Calculator for any company.
Cursor equity questions
- How is a Cursor NSO exercise taxed?
- Exercising a non-qualified stock option (NSO) creates ordinary income on the bargain element (the price on the day you exercise minus your strike), subject to federal income tax, state income tax, and FICA. The calculator above computes that tax for your Cursor grant and compares selling the shares now against holding past the one-year mark for long-term capital-gains treatment.
- Does Cursor grant ISOs, NSOs, or RSUs?
- Equity compensation at Cursor typically takes the form of incentive stock options (ISOs) and non-qualified stock options (NSOs). Incentive stock options can trigger the alternative minimum tax (AMT) when you exercise.
- Are Cursor shares eligible for QSBS?
- They might be. Qualified small business stock (QSBS) under Internal Revenue Code Section 1202 can exclude federal tax on much of the gain when shares were acquired at original issuance from a C-corporation while its gross assets were under $50 million, and held at least five years. Whether your Cursor shares qualify turns on when you acquired them and the company's asset size at that time.
One piece of the puzzle.
OptionsAhoy plans your Cursor equity alongside hedging, vesting, and de-concentration, across bullish, neutral, and bearish market scenarios. Free during beta.