Frequently Asked Questions

Employee Ownership FAQs

Common questions about employee stock ownership plans (ESOPs), employee ownership trusts (EOTs), and other forms of employee ownership, from the basics to technical topics.

This FAQ is written primarily for business owners, managers, and advisors involved in setting up or running an employee ownership plan. If you're an employee at an ESOP company looking to understand your own benefits and rights, see our articles on Working at an ESOP Company and The Rights of ESOP Participants.

NCEO employee ownership FAQ hero (keyboard)

If options to acquire shares with additional or extra voting rights are issued, how is their value calculated for S corporation anti-abuse testing under Section 409(p)?

Options to acquire unissued shares having more voting rights than the ESOP owned stock will be increased in proportion to the vote.

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Link to this FAQ Topic: S Corporation ESOPs