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What is a 409A Valuation

What is a 409A Valuation
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Independent formal appraisal of the fair market value (FMV) of a private company’s common stock (the stock reserved mainly for founders and employees).
Named after Section 409A of the U.S. Internal Revenue Code, it's required by the IRS to ensure that stock options and other equity-based compensation are being issued at fair market value.

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