Houghton Bill Would Encourage Broad Stock Options

Representative Amo Houghton (R-NY) has introduced legislation (H.R. 2788, untitled) that would extend incentive stock option (ISO) treatment to non-highly compensated employees receiving options even if these employees do not meet the ISO "two year holding from grant" and "one year holding from exercise" rules. To qualify for this, however, a company would have to grant at least 50% of the aggregate fair market value of any options granted that year to non-highly qualified employees (generally, employees making under $80,000 per year). The bill has bipartisan support from several House members and is similar to legislation introduced last Congress by Senate minority leader Tom Daschle (D-SD).