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Pastimes : Clown-Free Zone... sorry, no clowns allowed
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To: IceShark who wrote (5633)7/25/2000 12:41:43 PM
From: Ilaine  Read Replies (2) of 436258
 
The way I look at it, the employer should not get a tax deduction when it gives shareholders stock options in lieu of salary, as it is just a dilution of shareholder equity, and should be a tax-free event. However, as I understand it, and feel free to correct me if I am wrong, the employer DOES take a tax deduction when the employee exercises the option, so the corporation treats the transaction as if it were salary. It walks like a duck, call it salary.
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