Stock Options, Option-Related Implications of TCJA, and Tax Loopholes

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Responses to Questions
1] Briefly describe the potential tax implications of Elon Musk’s option exercise.
Stock options are exercised, and they get taxed as ordinary income rates considering the gain (bargain element), which is the difference between the share price and the strike price (predetermined price) and the number of shares. The options are not tradable before the exercise. Musk needs millions to cash to exercise the options but would pay billions in taxes as Tesla’s share price has fluctuated between $ 900 and $1,200 in the year 2022. 
2] In your own words, please describe what the Tax Cuts and Jobs Act (TCJA) changed with regard to the performance exception for executive compensation.
The Tax Cuts and Jobs Act (TCJA) eliminated the exception for performance-based compensation under Section 162(m) that limited executive pay to $ 1 million for a tax deduction. However, the limit did not apply to bonuses stock options. Corporations can only deduct 1 million of total executive compensation for an executive in a year, including stock options and cash (De Simone & Stomberg, 2022).
3] Does it seem reasonable to you to cap deductible executive compensation at $1 million per executive? Why or why not?
The $1 million-dollar limit on the deductibili...