That depends on the facts and circumstances. If they become liquid and valuable before you exercise them, you’re taxed as wages or short-term capital gains rates on those gains.
I’m no expert but I thought the worst case was AMT, which taxes the bargain element when you exercise an option (rather than when you sell the received shares and recognize the gain). Are you talking about a tax on granted options, or when options are in the money but you haven’t exercised yet?
There is no tax due on unexercised options (which is not what I meant to imply above, but I left it ambiguous).
If you have non-qualified stock options (NQSOs), on the day you exercise, the difference between the strike price and the fair market price is taxed as ordinary income. That's what I was talking about.
If you have Incentive Stock Options (ISOs), the tax treatment can be more favorable if you follow certain rules, primarily that you have to sell the shares no earlier than two years after the option grant AND one year after you exercise them. The AMT calculation comes into play between the exercise and sale.
Basically, figure out exactly what you have, as the type of instrument you have changes the taxation, and read the tax laws on that. This is not tax advice.
