What Happens to Your Employee Stock Options (ISO/NSO) Account When You Die
Quick Facts
Type
Employee Stock Options
Urgency
URGENT — options may expire within 90 days
Key Risk
Post-termination exercise window (often 90 days)
Tax Note
ISOs lose favorable tax treatment upon death; treated as NSOs
Step-by-Step Guide
Determine the post-termination exercise window
Contact the employer immediately to determine how long the estate has to exercise vested stock options after death. Most plans allow 90 days, but some allow up to 12 months. Missing this window means the options are forfeited permanently, regardless of their value.
Estimated time: Within days — critical deadline
Review all option grants
Obtain a complete list of all stock option grants: grant date, number of shares, vesting schedule, exercise price, current fair market value, and whether they are ISOs or NSOs. Calculate the intrinsic value (current value minus exercise price) for each grant.
Decide which options to exercise
Work with a tax advisor and estate attorney to determine which options are "in the money" (current value exceeds exercise price) and worth exercising. Consider the cost of exercise, tax implications, and whether the company is public or private.
Exercise options through the plan administrator
If the estate decides to exercise options, work with the stock plan administrator to process the exercise. The estate will need to pay the exercise price. For public companies, a same-day sale may be possible. For private companies, the estate will hold illiquid shares.
Estimated time: Before exercise window closes
Document Now Checklist
- Employer name
- Stock plan administrator
- Number of vested options
- Exercise price per grant
- Current fair market value
- Exercise window expiration date
- ISO vs. NSO designation
- Grant agreement copies
Last verified: June 2026. Platform policies may change. Verify current procedures directly with Employee Stock Options (ISO/NSO). This guide is for informational purposes only and does not constitute legal advice.
Related Guides
Workday
Contact the deceased's employer HR department first — they coordinate most of these benefits and can provide contact information for each plan administrator.
ADP
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Paychex
Contact the deceased's employer HR department first — they coordinate most of these benefits and can provide contact information for each plan administrator.
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