Plan your Modal Labs NSO exercise
Calculator · free · no signup · pre-IPOModal Labs is pre-IPO. Plan your NSO exercise tax (federal, state, FICA) at any expected valuation.
Beta · invite-only · AlphaLatitude Inc. · Free Tools
Your grant
Tax inputs
Hold strategy
Best after-tax payout — at year 1
$199,080
Sell + invest wins by $20,783 over Hold 1 yr.
Estimates only. Not financial advice.
Sell + invest
Best payout| Bargain element (sale − strike) | $350,000 |
| Federal | |
| State | |
| Medicare | −$5,075 |
| Additional Medicare | −$3,150 |
| Market gain over 1 yr at 10.0% | $18,573 |
| LTCG on diversified gain (fed + state + NIIT) | −$5,219 |
| Net at year 1 | $199,080 |
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 | $178,297 |
Sold 2,678 shares at exercise to cover strike + tax; 2,322 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 Modal Labs
Modal Labs is a privately held AI company, incorporated in Delaware and headquartered in New York, NY.
Serverless AI compute.
Equity grants at Modal Labs typically include incentive stock options (ISOs) and non-qualified stock options (NSOs).
Erik Bernhardsson, who spent seven years building Spotify's music recommendation systems, founded Modal Labs in January 2021. Co-founder and CTO Akshat Bubna joined that August. Modal provides a serverless compute platform targeted at AI engineers: developers write Python functions and Modal handles GPU provisioning, container scaling, and job scheduling without managing infrastructure. The company raised an $87 million Series B in July 2025 led by Lux Capital, reaching a $1.1 billion valuation and unicorn status. Total funding stands at $111 million.
Sources: modal.com · siliconangle.com
OptionsAhoy is an independent tool and is not affiliated with, endorsed by, or sponsored by Modal Labs.
Modal Labs 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.
All Modal Labs tools → · Use the generic NSO Exercise Calculator for any company.
Modal Labs equity questions
- How is a Modal Labs 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 Modal Labs grant and compares selling the shares now against holding past the one-year mark for long-term capital-gains treatment.
- Does Modal Labs grant ISOs, NSOs, or RSUs?
- Equity compensation at Modal Labs 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 Modal Labs 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 Modal Labs 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 Modal Labs equity alongside hedging, vesting, and de-concentration, across bullish, neutral, and bearish market scenarios. Free during beta.