Company stock free from employer withholding--for now. (IRS News).The IRS An abbreviation for the Internal Revenue Service, a federal agency charged with the responsibility of administering and enforcing internal revenue laws. will not forge ahead with a plan to force employers to withhold Social Security and other payroll taxes Payroll Tax Tax an employer withholds and/or pays on behalf of their employees based on the wage or salary of the employee. In most countries, including the U.S., both state and federal authorities collect some form of payroll tax. on company stock that employees buy through options or company purchase plans. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. congressional estimates, the taxes were expected to cost employees a total of $23 billion over 10 years. Employees still owe regular income taxes on their stock and option profits, and the IRS decision has no bearing on non-qualified stock options Non-qualified stock options are stock options which do not qualify for the special treatment accorded to incentive stock options. Incentive stock options are only available for employees and other restrictions apply for them. . However, IRS officials say they will continue to evaluate the suggestions and legal arguments they received after issuing the proposed regulations last year. If they do go ahead, businesses can count on a two-year warning before implementing any final rules. |
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