Nonstatutory Stock Options (Portfolio 383)

Bloomberg Tax Portfolio, 383 T.M., Nonstatutory Stock Options, examines the rules governing the taxation of stock options granted to employees by their employers as compensation for services rendered. Under the Internal Revenue Code, there are two basic types of compensatory stock options — statutory and nonstatutory. This Portfolio focuses on nonstatutory stock options. For an analysis of the rules governing the taxation of statutory stock options, see 381 T.M., Statutory Stock Options. Section 83 of the Code (and §409A, as applicable) governs the taxation of compensatory nonstatutory stock options as part of that section's coverage of the taxation of all property transferred in connection with the performance of services. For a detailed discussion of §83, see 384 T.M., Restricted Property — Section 83.

The Worksheets include a sample nonstatutory stock option/stock appreciation rights plan and other practitioner aids. To assist in researching a particular topic, a Bibliography is provided.