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UNDERSTANDING
COMPENSATORY STOCK OPTIONS
A review of the terminology, exercise techniques and tax treatment of stock optionsMany employers utilize stock options as a form of
compensation to retain
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What is compensatory stock options?
Compensatory stock options are stock options granted to employees as part of their compensation package.
Who is required to file compensatory stock options?
Employers are required to file compensatory stock options on behalf of their employees.
How to fill out compensatory stock options?
Compensatory stock options can be filled out by providing information such as the grant date, number of options granted, exercise price, and vesting schedule.
What is the purpose of compensatory stock options?
The purpose of compensatory stock options is to incentivize employees to work towards the success of the company by tying their compensation to the performance of the stock.
What information must be reported on compensatory stock options?
Information such as the fair market value of the options, the date of grant, and any restrictions on the options must be reported on compensatory stock options.
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