PRESIDENT GEORGE W. BUSH Message Board

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Politics : PRESIDENT GEORGE W. BUSH

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To: DuckTapeSunroof who wrote (383893)	4/1/2003 10:23:05 PM
From: Kevin Rose	Read Replies (1) of 769670

Not quite. Most options are granted using the current value of the stock. If they aren't, then typically the difference is counted as ordinary income for that tax year. Otherwise, company A could grant stock in lieu of salary and circumvent normal tax treatment. ISOs (a variety of stock option) can be granted at down to 85% of the current stock value (at least it was that way a number of years ago). There is a limit to the amount of ISO stock a company can issue options for. Options are proven motivators and can result in huge productivity gains, if used properly. Obscene grants to top executives are generally not as productive as spreading grants to the people who actually do work.

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