Honestly, this feels like an accounting trick to recognize taxes sooner. This helps the early year or years of the budget balance, at the determent of the later years, which usually don't count for budget scoring.

In this case, it also gives a fair number of people a bigger tax headache. In some cases, taxing earlier may mean future gains become capital gains when they may have been ordinary income; that's not good for tax revenue, even if you get some of it sooner.

It's already taxed whenever they exercise.

Well, perhaps increasing tax at exercise was politically untenable, but tax at vesting was. Just a hunch that they needed to grab from somewhere easy.

It is definitely easier to sell "oh this is just an esoteric part of the tax code that effects a small percentage of people. You know, we are just moving around when they pay taxes it's not like a tax increase or decrease".

How about taxing the options when they are actually sold, and gains are actually realized?

As income tax or capital gains tax? Because usually with income there should be some income tax somewhere.

I don't think it's an unintended consequence. I think it was meant to punish Big Tech for their resistance to the Republican party in the 2016 election.

That is another hunch that I was considering posting but personally I'm skeptical of this. While immigration reform may have fell on its face due to opposition from tech firms, I find it hard to believe the Trump administration would conceive such an effective means of targeting them.

It stands to reason that they recognized NSOs/ISOs being used heavily (perhaps more than anyone else) by tech firms but this just seems like a recognition that wealth taxation woefully needs reform. The estate tax is being retired so this seems to balance it out.

> The estate tax is being retired so this seems to balance it out.

So taxes on people that work for a living are raised to pay for eliminating the estate tax multi-millionaires?