typical example
Prompts in the financial industry can also be quite complex for reasons similar to legal prompts. The following is an exercise in a financial usage scenario in which Claude were used to analyze tax information and answer questions. As with the legal services example, we have reordered some of the elements as our solution hints are more appropriate in a different process (however, other structures can be used as well).
We recommend that you scroll to the bottom of the page to see what expected inputs you need to consider (including what {{VARIABLE_WORDS}} is). Be sure to reference this {{VARIABLE_WORD}} directly somewhere in the prompt so that the actual variable content can be substituted in. Then, fill in each yellow box with the prompt element as described and as you saw in the previous three complex prompt examples. Once you've filled in all the yellow boxes, you'll see your final prompt splice result in the purple box at the bottom.
Keep in mind that cue word engineering is rarely completely formulaic, especially when targeting large and complex cues! It is important to develop test cases andExperiment with a variety of prompts and cue structures to figure out what works best for each situationThe
cue element | descriptive | typical example | note |
---|---|---|---|
1. "User:" format | Start your CLAUDEMESSAGES() prompt with "User:". | User. | This is required! It is always required to start with this when using the CLAUDEMESSAGES() prompt. |
2. Background to the mandate | Give Claude the context of the role it should play or the goals and tasks you want it to take on in the prompt. | You are a tax-savvy accountant. Your task is to answer user questions based on the references provided. | It's best to give context in the beginning of the prompt. |
3. Tonal context (optional) | If it is important in the interaction, tell Claude the tone of voice that should be used. | Depending on the task, this element may not be necessary. | |
4. Input data to be processed | If Claude needs to process data from the prompt, include that data within the relevant XML tags. Multiple data items can be included, but make sure that each data item is enclosed in its own XML tag. | "This is the material you should use to answer user questions: {{TAX_CODE}} " | When the input data is very long, it is best to provide it before the instruction. |
5. Examples | Give Claude at least one example of an ideal response so that it can be emulated. Enclose them in XML tags. If multiple examples are provided, give Claude context for what those examples are and enclose each example in its own XML tags. | "This is an example of how to answer: What defines an "eligible" employee? Under this subsection-- (A) General The term "eligible employee" means any individual who-- (i) is not an excluded employee, (ii) agrees, in accordance with an election under this subsection, to-- (A) meet the requirements established by the Secretary to ensure that the withholding requirements of the corporation under chapter 24 are satisfied. to meet such requirements as the Secretary determines are necessary to ensure that the withholding requirements of the Corporation under chapter 24 are satisfied. Based on the documentation provided, an "Eligible Employee" is defined as an Employee who: 1. is not an Excluded Employee as defined in the documentation; and 2. agrees to meet the requirements established by the Secretary. 2. agrees to meet the requirements established by the Secretary to ensure that the Corporation's withholding requirements for Qualified Stock under Chapter 24 are met. " | Examples are probably the most effective tool for getting Claude to behave as expected. Be sure to give examples of common edge cases. If prompted to use a sketchbook, it is also effective to give examples from the sketchbook. Usually more examples = more reliable responses, but with increased latency and token consumption. We only give one example here to make the prompt easier to read. |
6. Detailed mission descriptions and rules | Expand on the specific tasks you want Claude to perform and any rules Claude may need to follow. Here you can also give Claude the option to "quit" if it doesn't have an answer or doesn't know. | "First, collect relevant citations in tags to answer user questions. If there are no citations, write "No relevant citations found". Then insert two blank lines in the tag and answer the user question. Answer the user's question only if you are sure that the citation in the tag supports your answer. If not, tell the user that you unfortunately do not have enough information to answer the user's question." | It is ideal to show this description and rules to a friend to ensure that the logic is clear and any ambiguous terms are clearly explained. |
7. Description of immediate tasks | "Remind" Claude or just tell Claude what needs to be done immediately to accomplish the prompted task. This is also where you can put in additional variables such as user questions. | It's a user problem: {{QUESTION}} | It is usually not harmful to reiterate Claude's immediate task. It is best to place this at the end of a long prompt for better results. It is also usually good practice to place the user query at the bottom of the prompt. |
8. Prejudging (step-by-step thinking) (optional) | For tasks that have more than one step, it is a good idea to tell Claude to think step by step before giving the answer. Sometimes you may need to say "Before you give your answer ......" to make sure Claude does this step first. | Increases the intelligence of the response, but also increases the latency by increasing the length of the output. | |
9. Output format (optional) | If you want Claude's responses to be rendered in a particular format, please explicitly tell Claude what that format is. | Depending on the task, this element may not be necessary. | |
10. Pre-populated Claude's response (if any) | " a space that can be used to start a Claude response in order to direct Claude's behavior or response. If you want to pre-populate Claude's response, you must include "Assistant:" and it must be included as a new line, otherwise it will be treated as part of the "User:" round (which we'll handle for you automatically in this exercise! )." | You only need "Assistant:" if you want to pre-populate Claude's response. Otherwise, it can be omitted. |
Now let's link everything together, insert the replacement and see how it looks!
Tip: If you want to see the full cue box, you can set theyellow (color)of the Replace prompt box is copied and pasted into a text editor.
Tip template (linked from above)
User: You are a senior tax accountant. Your task is to answer the user's questions using any reference documentation provided.
Here are the materials you should use to answer the user's questions:
{{TAX_CODE}}
Here is an example of how to respond:
What defines a "qualified" employee?
For the purposes of this subsection-- (A) In general
(A) In general
The term "eligible employee" means any-- (i) individual who is not an excluded employee; and
(i) is not an excluded employee, and
(ii) agrees to make an election under this subsection to comply with such requirements as the Secretary determines are necessary to ensure that a corporation is subject to the withholding requirements for eligible stock under chapter 24. </quotes
Based on the documentation provided, an "Eligible Employee" is defined as an individual who:
1. is not an "excluded employee" as defined in the documentation; and
2. agrees to comply with such requirements as the Minister may determine to ensure that the Company's withholding requirements for Eligible Shares under Chapter 24 are met. </answer
</example
First, collect citations in the tag that are relevant to answering the user's question. If there are no quotes, write "No relevant quotes found".
Then insert two paragraph breaks before the answer to the user's question and answer it in the tag. Answer the user's question only if you are sure that the quote in the tag supports your answer. If you're not sure, tell the user that you don't have enough information to answer their question.
Here is the user question: {{QUESTION}}
variant
Input {{QUESTION}}
How long do I have to submit an 83(b) election petition?
Input {{TAX_CODE}}
(a) General rule
If, in connection with the provision of services, property is transferred to any person other than the person receiving the services, the fair market value of the property (ignoring any limitation other than a limitation that never expires under the terms) shall be exceeded at the earlier of:
(1) the fair market value at the first point in time at which the beneficiary's interest in the property is transferable or no longer subject to a substantial risk of forfeiture, exceeds
(2) the amount, if any, paid for the property, which
shall be includible in the gross income of the person providing the service, as applicable in the taxable year in which the interest first becomes transferable or is no longer subject to a substantial risk of forfeiture. The preceding sentence does not apply if the person sells or otherwise disposes of the property at fair trading value before the rights in the property become transferable or no longer subject to a substantial risk of forfeiture.
(b) Election to include in gross income in year of transfer
(1) Summary.
Any person to whom property relating to the provision of services is transferred to another person may elect to include the property in his or her gross income for the taxable year of the transfer by computing the excess in the following manner:
(A) the fair market value of the property at the time of the transfer (ignoring any limitations other than limitations that never expire under the terms), exceeds
(B) the amount, if any, paid for the property.
If such an election is made, subsection (a) shall not apply to the transfer of the property and, if the property is subsequently forfeited, no amount shall be deducted with respect to such forfeiture.
(2) Election
An election under paragraph (1) with respect to the transfer of any property shall be made in such manner as the Secretary may prescribe and shall be made not more than 30 days after the date of such transfer. The election shall be irrevocable except with the consent of the Secretary.
(c) Special rules
For purposes of this section-
(1) Significant risk of forfeiture
A person's right to property is subject to a substantial risk of forfeiture if the person's right to the property is contingent on the future performance of substantial services by any individual.
(2) Transferability of property
A person's rights in property are transferable only if the rights of any transferee of the property are no longer subject to a substantial risk of forfeiture.
(3) Sales that may give rise to litigation under section 16(b) of the Securities Exchange Act of 1934
To the extent that a sale of property at a profit may subject a person to litigation under section 16(b) of the Securities Exchange Act of 1934, the person's rights in the property are- (A) subject to a substantial risk of forfeiture; and
(A) are subject to a substantial risk of forfeiture, and
(B) are not transferable.
(4) For purposes of determining the basis of an individual in a transfer of property related to the provision of services, a rule similar to the rule in section 72(w) shall apply.
(d)Certain limitations that never expire
(1) Valuation
In the case of property subject to a limitation that never expires, if the limitation permits the transferee to sell the property only at a price determined by a formula, that price shall be deemed to be the fair market value of the property unless the Secretary proves to the contrary, and the burden of proof shall be on the Secretary.
(2) Removal
In the case of property subject to a limitation that never expires, the limitation is canceled unless the taxpayer proves that-- (A) the property is subject to a limitation that never expires; and
(A) the removal was not compensatory, and
(B) if the rescission is treated as a compensatory transaction, the individual allowing the deduction will treat the transaction in a compensatory manner by providing evidence, in the manner prescribed by the Secretary by regulation, of the
the fair market value of the property at the time of the cancellation, ignoring the limitation, exceeds the sum of
(C) the fair market value of the property (taking into account the limitation) computed immediately before the cancellation, and
(D)the amount, if any, paid for the cancellation.
shall be treated as compensation for the taxable year in which the cancellation occurs.
(e)Applicability of this section
This section shall not apply to-.
(1)transactions to which section 421 applies.
(2)a transfer under a trust under section 401(a) or a transfer under an annuity plan that meets the requirements of section 404(a)(2).
(3) a transfer of an option that does not have a definable fair market value.
(4) a transfer of property resulting from the exercise of an option that has a definable fair market value on the date of grant, or
(5)group life insurance to which section 79 applies.
(f)Holding period
In determining the period during which a taxpayer holds property to which subsection (a) applies, the taxpayer shall include only the period beginning at the time when the taxpayer's rights first become transferable in the property or are no longer subject to a substantial risk of forfeiture.
(g)Certain exchanges
If property to which subsection (a) applies is exchanged for property subject to limitations and conditions similar to those of the property exchanged, and section 354, 355, 356, or 1036 (or section 1031 in connection with section 1036) applies to the exchange, or if the exchange is made pursuant to the conversion privilege- (i) the period of time during which the property is subject to the conversion privilege shall not include the period from the time when its rights first become transferable in the property or are no longer subject to a substantial risk of forfeiture.
(1) the exchange shall be disregarded for purposes of subsection (a), and
(2) the property received shall be treated as property to which subsection (a) applies.
(h)Employer's deductions
In the case of a transfer of property to which this section applies or the removal of a limitation under subsection (d), a deduction under section 162 shall be allowed for the amount included in the gross income of the service provider in connection with the transfer of the property or removal of the limitation. The deduction shall apply to the taxable year in which the service provider included the amount in its gross income or to the taxable year in which it ended.
(i) Qualified equity grants
(1)Overview.
For purposes of this Act-
(A) Timing of crediting
In the case of a transfer of qualified stock to an eligible employee who makes a related election, income to the employee under subsection (a) of this paragraph shall be includible in the employee's income in the taxable year specified in subparagraph (B) rather than in the taxable year described in subsection (a).
(B) Determination of taxable year
The taxable year determined under this subsection shall be the taxable year of the employee that contains the earliest of any of the following dates:
(i)the date on which such Qualified Stock first becomes transferable (including, for purposes of this subparagraph only, if transferable to an employer).
(ii)the date on which the employee first becomes an excluded employee.
(iii)the date on which any shares of stock of a corporation issuing qualified stock first became freely tradable on an established securities market (as determined by the Secretary, but excluding any market unless such market has been determined by the Secretary to be an established securities market to which a provision of this title, other than this subsection, applies).
(iv)the date after the expiration of 5 years of such stock of the employee, which date is the earlier of the date on which such stock first becomes transferable or is no longer subject to a substantial risk of forfeiture, or
(v)the date on which the employee revokes (at such time and in such manner as the Secretary may prescribe) the election made pursuant to this subsection with respect to such stock.
(2) Qualified stock
(A) SUMMARY
For purposes of this subsection, the term ''eligible stock'' means stock of a corporation with respect to any eligible employee if- (i) such stock is not subject to the provisions of this section
(i) the acquisition of such stock--(I) is related to the acquisition of the stock
(I) in connection with the exercise of an Option, or
(II) in connection with the settlement of Restricted Stock Units, and
(ii) the option or restricted stock unit is granted by the Company-
(I) in connection with the performance of services as an employee, and
(II) granted during the calendar year in which the Company is an Eligible Company.
(B) Restrictions
Stock is not "Qualified Stock" if the employee can sell the stock to the Company or receive cash from the Company in lieu of stock when his or her rights first become transferable or are no longer subject to a substantial risk of forfeiture.
(C) Qualified corporation
For purposes of subparagraph (A)(ii)(II)--(i) summarize
(i) SUMMARY
The term ''qualified company'' means a company that, in any calendar year, meets the following conditions:
(I) any shares of stock of such corporation (or shares of its predecessor) have not been freely traded on an established securities market (as defined in paragraph (1)(B)(iii)) during any prior calendar year, and
(II) the Company has a written plan under which all employees of at least 80% who perform services for the Company within the United States (or a U.S. territory) during such calendar year are granted Options or Restricted Stock Units with the same rights and privileges to receive Qualified Stock.
(ii) Same rights and privileges
For purposes of subclause (i)(II)---(I) the
(I)except as otherwise provided in subclauses (II) and (III), the determination of rights and privileges with respect to stock shall be similar to the provisions under section 423(b)(5).
(II) if the number of shares available to all employees is not equal, the employees shall not be deemed not to have the same rights and privileges solely by reason thereof, so long as the number of shares available to each employee exceeds the minimum number, and
(III) the rights and privileges of exercising Options shall not be deemed to be the same as the rights and privileges of settlement of Restricted Stock Units.
(iii)The Employee
For purposes of clause (i)(II), the term "Employee" does not include an Employee described in Section 4980E(d)(4) or any Excluded Employee.
(iv)Special rules for calendar years prior to 2018
For any calendar year before January 1, 2018, subsection (i)(II) shall apply without regard to whether the rights and privileges of the Qualified Stock are the same.
(3) Eligible employees; excluded employees
For purposes of this subsection-
(A) SUMMARY
The term "eligible employee" means any individual who:
(i) is not an excluded employee, and
(ii) in making an election under this subsection, agrees to comply with such conditions as the Secretary determines to be necessary to ensure that the corporation is subject to qualified stock withholding requirements under chapter 24.
(B) Excluded employees
The term "excluded employee" means any individual who, with respect to any corporation-- (i) is an employee of the corporation during the period in which he or she is an employee of the corporation; and
(i) who was an 1% Owner (as defined in section 416(i)(1)(B)(ii)) at any time during the calendar year or at any time during the preceding 10 calendar years, and
(ii) now or at any time in the past -
(I) is the chief executive officer of such corporation or the individual holding such position, or
(II) is the chief financial officer of such corporation or an individual holding such position.
(iii) has a relationship described in section 318(a)(1) with any individual described in clause (ii)(I) or (II), or
(iv) was one of the 4 highest compensated executives of the corporation for the taxable year, or was one of the 4 highest compensated executives of the corporation for any of the 10 preceding taxable years, pursuant to the shareholder compensation disclosure rules under the Securities Exchange Act of 1934 (assuming that such rules apply to the corporation).
(4) Election
(A) Timing of election
The election of eligible stock shall be made not later than 30 days after the employee's rights first become transferable or are no longer subject to a substantial risk of forfeiture, whichever is earlier, and the election shall be made in a manner similar to the manner in which elections are made under subsection (b).
(B) Limitations
No election may be made under this section with respect to any Eligible Stock if- (i) the following conditions are met
(i) the Eligible Employee has made an election under subsection (b) with respect to such Eligible Stock.
(ii) any stock of the corporation issuing the qualified stock was freely tradable on an established securities market (as defined in paragraph (1)(B)(iii)) before the election was made, or
(iii) the corporation purchased any of its outstanding stock in the calendar year preceding the calendar year that includes the calendar year in which the employee's interest is transferable or is no longer subject to a significant risk of forfeiture, unless- (I) the corporation purchased the stock in the calendar year in which
(I) not less than 251 TP3T in the aggregate amount of the stock purchased by the corporation is deferred stock, and
(II) the individuals from whom the deferred stock was purchased are identified in a reasonable manner.
(C) Definitions and Special Rules Relating to Restrictions on Redemption of Stock
(i) Deferred Stock
In this paragraph, the term "Deferred Stock" means Stock validly selected under this subsection.
(ii) Deferred Stock relating to an individual shall not be counted if the individual holds Deferred Stock with a longer Deferral Period
Stock purchased by the Corporation from any individual shall not be treated as Deferred Stock for purposes of subparagraph (B)(iii) if such individual holds (immediately after such purchase) any Deferred Stock with an Election Period that is longer than the Election Period with respect to the stock purchased.
(iii) Purchase of all outstanding Deferred Stock
The requirements (I) and (II) of subparagraph (B)(iii) shall be deemed to be satisfied if the stock purchased consists of all outstanding deferred stock of such corporation.
(iv) Reporting
Any corporation that owns outstanding deferred stock at the beginning of the year and that purchases any outstanding stock during such calendar year shall set forth on its tax return at the end of its taxable year or at the end of such calendar year the aggregate amount of outstanding stock purchased by it during such calendar year, together with such other information as may be required by the Secretary of State to carry out this paragraph.
(5) Controlled groups
For purposes of this subsection, all persons treated as a single employer under section 414(b) shall be treated as a corporation.
(6) Notification requirements
Any corporation that transfers qualified stock to an eligible employee shall, at the time the amount generated by the stock first becomes includible in the gross income of the employee (in the absence of this subsection) or within a reasonable period before that time-- (a) certify to the employee that the stock was transferred to the employee; and (b) certify to the employee that the stock was transferred to the employee.
(A) certify to the employee that the stock is qualified stock, and
(B) notify the employee-- (i) that the employee may have eligible stock, and
(i) that the employee may be eligible to elect to defer income on the stock under this subsection, and
(ii) that if the employee makes such election--(A) the employee may be eligible to elect to defer income from the stock under this subsection; and
(I) the amount of income recognized at the end of the deferral period will be based on the value of the stock at the time the employee's interest in the stock first becomes transferable or is no longer subject to a significant risk of forfeiture, regardless of whether the value of the stock declines during the deferral period.
(II) the amount of income recognized at the end of the deferral period will be subject to withholding under section 3402(t) at the rate specified in section 3401(i), and
(III) the employee's liability with respect to such withholding (as determined by the Secretary under paragraph (3)(A)(ii)).
(7) Restricted stock units
This section (except this subsection), including any election under subsection (b), does not apply to restricted stock units.
Splicing tips with replacement
User: You are a senior tax accountant. Your task is to answer the user's questions using any reference documents provided.
Here are the materials you should use to answer the user's questions:
<docs
(a) General rules
If, in the course of the performance of a service, property is transferred to any other person than the person for whom the service is performed, the excess of the following amounts shall be includible in the gross income of the person performing the service:
(1) the fair market value of the property (without regard to any limitation, unless the limitation by its terms never expires) at the time of the first transfer of the property to a person with a beneficial interest in the property that is transferable or no longer subject to a substantial risk of forfeiture, whichever occurs first; minus
(2) the amount paid, if any.
The excess shall be included in the gross income of such service provider for the taxable year in which the rights in the property first become transferable or are no longer subject to a substantial risk of forfeiture. The preceding sentence does not apply if the person sells or otherwise disposes of the property in a fair transaction before the person's rights are transferable or no longer subject to a substantial risk of forfeiture.
(b)Election to include in gross income in year of transfer
(1) General rule.
Any provider of services in connection with a transfer of property may elect to include in its gross income for the taxable year in which the property is transferred an excess of the following amounts:
(A) the fair market value of the property at the time of the transfer (without regard to any limitation, unless the limitation by its terms never expires); less
(B) the amount paid, if any.
If this option is elected, subsection (a) shall not apply to the transfer of the property, and if the property is subsequently forfeited, no amount shall be deducted with respect to such forfeiture.
(2) Election
An election in connection with the transfer of any property shall be made in such manner as the Minister of Finance may prescribe and shall be made not later than 30 days after the date of the transfer of the property. The election shall not be revoked except with the consent of the Minister of Finance.
(c) Special rules
For purposes of this section:
(1) Significant risk of forfeiture
A person's right to property is subject to a substantial risk of forfeiture if the person's entitlement to the property is subject to the person's future performance of significant services.
(2) Transferability of property
A person's right to property may be transferred only if the transferee's right to the property is not subject to a substantial risk of forfeiture.
(3) Sales that may give rise to litigation under Section 16(b) of the Securities Exchange Act of 1934
Whenever a sale of property at a profit may subject a person to a lawsuit under section 16(b) of the Securities Exchange Act of 1934, the person's rights in the property will-- (A) be subject to the risk of substantial forfeiture; and
(A) subject to a substantial risk of forfeiture, and
(B) not be transferable.
(4) For purposes of determining the basis of an individual's property in a transfer of property related to service performance, a rule similar to section 72(w) applies.
(d)Certain limitations that never expire
(1) Valuation
With respect to property subject to a restriction that by its terms never expires and that permits a transferee to sell the property only at a price determined by a formula, the determined price shall be deemed to be the fair market value of the property unless the contrary is proved by the Secretary, and the burden of proof shall be on the Secretary.
(2) Cancellation
If a limitation that never expires is canceled unless the taxpayer proves that--(A) the limitation is not expired; and
(A)that the removal is not compensatory, and
(B) if the rescission is treated as compensatory, any person entitled to the deduction will treat the transaction as noncompensatory in the manner prescribed by the Secretary by regulation.
then the excess of the fair market value of the property at the time of the cancellation (computed without regard to the limitation) over the sum of-- (A) the fair market value of the property at the time of the cancellation; and
(C)the fair market value of the property immediately prior to the cancellation, computed taking into account the limitation, and
(D)the amount, if any, paid for the cancellation.
shall be treated as compensation income for the tax year in which the cancellation occurs.
(e)Scope of application of this section
This section shall not apply to- (i) the amount of compensation income paid to a taxpayer for a taxable year to which the
(1)a transaction to which section 421 applies.
(2)a transfer to or from a trust described in section 401(a), or a transfer under an annuity plan that meets the requirements of section 404(a)(2).
(3) transfers of options that do not have a reasonably determinable fair market value.
(4) a transfer of property upon the exercise of an option that has a reasonably determinable fair market value on the grant date, or
(5) group term life insurance to which Section 79 applies.
(f)Holding period
In determining the period during which a taxpayer holds property to which subsection (a) of this section applies, there shall be included only the period beginning at the earliest time at which the person's rights in such property are transferable or not subject to a substantial risk of forfeiture.
(g) Certain exchanges
If property to which subsection (a) of this section applies is exchanged for property subject to limitations and conditions similar to those imposed on the exchanged property, and section 354, 355, 356, or 1036 (or section 1031, insofar as it relates to section 1036) applies to the exchange or the exchange is exercised pursuant to a right of conversion, then- (i) the exchange shall be effected in accordance with section 354, 355, 356, or 1036 (as applicable); and
(1) the exchange shall be disregarded for purposes of applying subsection (a), and
(2) the property received shall be treated as property to which subsection (a) applies.
(h)Employer deductions
If this section applies to a transfer of property or to the removal of a limitation described in subsection (d), the employer of a person who performs services for the person shall be allowed a deduction under section 162 in an amount equal to the amount that would be includible in the gross income of the person who performs the services under subsection (a), (b), or (d)(2). The deduction shall be applied to the amount included in the gross income of the person performing the services for the person's taxable year or for the year ending with that taxable year.
(i)Qualified equity grants
(1) GENERAL RULE
For purposes of this subtitle- The term "qualified equity grant" in subsection (1)
(A) Inclusion of time
If qualified stock is transferred to an eligible employee who elects to make an election under this subsection with respect to such stock, subsection (a) shall be applied by including the amount determined under this subsection with respect to such stock in the employee's taxable year determined in accordance with subparagraph (B) instead of the taxable year described in subsection (a).
(B) Determination of taxable year
The taxable year determined under this subparagraph is the taxable year of an employee that includes the earliest of- (i) the date on which
(i)the date on which such Qualified Stock first becomes transferable (including if it becomes transferable to the Employer solely for purposes of this subparagraph)
(ii)the date on which the employee first becomes an excluded employee.
(iii)the date on which any shares of stock of the corporation issuing the qualified stock first became freely tradable on an established securities market (as determined by the Secretary, but excluding any market that the Secretary recognizes as an established securities market unless the Secretary recognizes it as such under the provisions of this title other than this subsection), and
(iv)the date that is 5 years from the date on which the employee's rights in the stock first became transferable or ceased to be subject to a substantial risk of forfeiture, whichever is earlier, or
(v)the date on which the employee revokes the election made under this subsection with respect to the stock (at such time and in such manner as the Secretary may prescribe).
(2) Qualified stock
(A) General rule
For purposes of this subsection, the term ''eligible stock'' means stock of a corporation with respect to any eligible employee, if
(i) the stock is acquired by--(I) in connection with the acquisition of the stock
(I) in connection with the exercise of an Option, or
(II) in connection with the settlement of restricted stock units, and
(ii) the option or restricted stock unit was granted by the Company- (I) in connection with the exercise of an option, or
(I) in connection with the performance of services as an employee, and
(II) during the calendar year in which the corporation is a qualified corporation.
(B) Restrictions
A share of stock shall not be treated as qualified stock if, at the time when the employee's rights with respect to the stock first become transferable or are no longer subject to a substantial risk of forfeiture, the employee may sell the stock to the corporation or substitute cash for the stock.
(C) Qualified corporation
For purposes of subparagraph (A)(ii)(II)- (i) in general
(i) IN GENERAL
The term "qualified corporation" means any corporation that, during any calendar year- (I) in the case of any preceding calendar year
(I) the stock of such corporation (or any predecessor of such corporation) was not readily tradable on an established securities market (as determined under paragraph (1)(B)(iii)) during any preceding calendar year, and
(II) such corporation has a written plan under which, during such calendar year, not less than all of 80%'s employees in the United States (or any possession of the United States) who perform services for such corporation are granted stock options, or are granted restricted stock units, with the same rights and privileges to acquire Qualified Stock.
(ii) Same Rights and Privileges
For purposes of subclause (i)(II)-
(I) except as otherwise provided in subclauses (II) and (III), the determination of rights and privileges with respect to Stock shall be made in a manner similar to that provided in section 423(b)(5).
(II) Employees shall not be deemed not to have the same rights and privileges by reason of the unequal number of shares of Stock available to all Employees to the extent that each Employee receives more than a de minimis amount of Stock.
(III) The rights and privileges with respect to the exercise of Options shall not be deemed to be the same as the rights and privileges with respect to the settlement of Restricted Stock Units.
(iii) Employees
For purposes of subclause (i)(II), the term "Employee" shall not include any Employee described in Section 4980E(d)(4) or any Excluded Employee.
(iv) Special rule for calendar years before 2018
For any calendar year beginning before January 1, 2018, Subclause (i)(II) shall apply without regard to whether the rights and privileges with respect to the Qualified Shares are the same.
(3) Eligible employees; excluded employees
For purposes of this subsection- (A) General Provisions
(A) IN GENERAL
The term "eligible employee" means any person who- (i) is not an excluded employee; and
(i) who is not an excluded employee, and
(ii) in making an election under this subsection, agrees to meet such requirements as the Secretary determines are necessary to ensure that the withholding requirements of the Corporation under chapter 24 are met.
(B) Excluded employee
The term "Excluded Employee" means any individual who, with respect to any Corporation
(i) was an owner (as defined in section 416(i)(1)(B)(ii)) of 1% during any calendar year, or was such an owner of 1% at any time during the preceding 10 calendar years, and
(ii) is or has been at any prior time-
(I) the chief executive officer of such corporation or an individual serving in such capacity, or
(II) the chief financial officer of such corporation or an individual holding such position.
(iii) in a relationship described in section 318(a)(1) with any individual described in (I) or (II) of subclause (ii), or
(iv) was one of the 4 most highly compensated executives of the corporation during the taxable year or was one of the 4 most highly compensated executives of the corporation at any time during the preceding 10 taxable years, as determined in accordance with the stockholder disclosure rules of the Securities and Exchange Act of 1934, as such rules apply to the corporation, for each taxable year.
(4) Election
(A) Time for Making Election
An election with respect to Qualified Stock shall be made not later than 30 days after the first date on which the employee's rights with respect to such stock become transferable or are no longer subject to a substantial risk of lapsing, whichever is earlier, and shall be made in a manner similar to the election in section (b).
(B) Limitations
An election under this section may not be made with respect to any Eligible Stock if- (i) an Eligible Employee has made an election under subsection (a); and
(i) an eligible employee has made an election under subsection (b) with respect to such eligible stock.
(ii) before the election is made, any stock of the corporation issuing such qualified stock is readily tradable on an established securities market (as defined in paragraph (1)(B)(iii)), or
(iii) the corporation purchased any outstanding stock during the calendar year preceding the calendar year, unless- (A) the corporation purchased any outstanding stock during the calendar year preceding the calendar year in which the stock was purchased; or
(I) not less than 25% of the aggregate amount of stock purchased is deferred stock, and
(II) the determination of the individuals from whom the deferred stock was purchased was based on a reasonable basis.
(C) Definitions and special rules limiting redemption of stock
(i) Deferred Stock
For purposes of this paragraph, the term "Deferred Stock" means the stock with respect to which an election is in effect under this subsection.
(ii) If an individual holds Deferred Stock with a longer deferral period, the individual's Deferred Stock is disregarded
Stock purchased by the Corporation from an individual shall not be considered Deferred Stock for purposes of subsection (B)(iii) if the individual holds (immediately after such purchase) any Deferred Stock with respect to which an election is in effect for a longer deferral period than that in effect for the stock election being purchased.
(iii) Purchase of all outstanding Deferred Stock
Conditions (I) and (II) of subsection (B)(iii) are deemed to be satisfied if the stock purchased consists of all outstanding Deferred Stock of the Corporation.
(iv) Reporting
Any corporation that owns outstanding deferred stock at the beginning of any calendar year and that purchases any outstanding stock during such calendar year shall include in its tax return for the tax year in which such calendar year ends the total amount of outstanding stock purchased during such year and such other information as may be required by the Secretary of the Treasury for purposes of the administration of this paragraph.
(5) Control groups
For purposes of this subsection, all persons treated as a single employer under section 414(b) shall be treated as a corporation.
(6) Notification requirements
Any corporation that transfers qualified stock to an eligible employee shall be required to notify the employer of the transfer of the qualified stock in-
(A) the time (or within a reasonable period prior thereto) when the amount of such stock will (but is not affected by this subsection) be included for the first time in the gross income of such employee
(B) certify to the employee that the stock is qualified stock and notify the employee that- (i) the employee may be eligible for the stock under this subsection
(i) that the employee may be eligible to elect to defer income on such stock under this subsection, and
(ii) if the employee makes such election-
(I) the amount of income recognized at the end of the deferral period will be based on the value of the stock at the point at which the employee's rights first become transferable or are no longer subject to substantial risk, regardless of whether the value of the stock declines during the deferral period.
(II) the amount of Income recognized at the end of the Deferral Period will be subject to withholding based on the tax rate under Section 3401(i), as determined under Section 3402(t), and
(III) the employee's liability (as determined by the Secretary of the Treasury under paragraph (3)(A)(ii)) is related to such withholding.
(7) Restricted stock units
This section (other than this subsection), including any election under subsection (b), shall not apply to restricted stock units.
</docs
The following is an example of how to respond:
<example
<question
What defines a "qualified" employee?
For the purposes of this subsection- (A) in general
(A) In general
The term "eligible employee" means any- (i) individual who is not an excluded employee, and
(i) an individual who is not an excluded employee, and
(ii) agrees, in an election under this subsection, to meet such requirements as the Secretary determines are necessary to ensure that the withholding requirements of the corporation with respect to eligible stock under chapter 24 are met. </quotes
Based on the documentation provided, "Eligible Employee" is defined as:
1. is not an "excluded employee" as defined in the documentation; and
2. agrees to fulfill the requirements established by the Secretary to ensure that the corporation's withholding requirements for qualified stock under chapter 24 are met. </answer
</example
First, collect the citations in the tag that are relevant to answering the user's question. If there are no relevant quotes, write "No relevant quotes found".
Then insert two paragraph breaks in the tag when answering the user's question. Answer the user's question only if you are sure that the references in the tags support your answer. If you are not sure, tell the user that you do not have enough information to answer their question.
The user's question is: How long will it take me to make an 83b election?
Claude's answer
Under paragraph (1), with respect to any transfer of property, the election shall be conducted in the manner prescribed by the Secretary and shall be completed not later than 30 days after the date of the transfer. The election may not be revoked except with the consent of the Secretary.
According to the document, you have 30 days after the date of transfer of the property to make an 83(b) election. That election cannot be revoked except with the consent of the Secretary.