New Regulations On Employee Stock Purchase Plans

Law360, New York (December 9, 2009, 1:16 PM EST) -- The IRS recently released updated regulations governing employee stock purchase plans (ESPPs).

The changes are generally favorable to employers and employees, but one technical change creates significant tax and administrative problems for any offering period that begins on or after Jan. 1, 2010.

Employers should carefully review their ESPPs before the end of 2009 and adopt any necessary amendments to comply with the new regulations. In many cases, board approval may be required.

Many public companies have established ESPPs to allow employees to purchase company shares...
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