House Subcommittee Approves "Super Stock Option" Bill

The Employer-Employee Relations Subcommittee of the House Committee on Education and the Workforce approved by voice vote HR 3462, the "Wealth Through the Workplace Act." The bill, introduced by John Boehner (R-OH) with bipartisan support, would create a new type of stock option that would combine the tax deductibility of the spread on stock option exercise that applies to non-qualified options with the capital gains tax treatment of incentive stock options. In order to be eligible, a plan would have to offer options to at least half the full-time workforce that had worked for at least two years. Options would have to be granted at 85% or more of fair market value and could not be substituted for other compensation. Workers exercising the options would not have to pay tax on exercise, and, if they hold the shares for a year, would pay capital gains tax on sale.

The bill now moves to full committee, where prospects look encouraging for quick action.