Employee Stock Purchase Plan - ESPP

Dictionary Says

Definition of 'Employee Stock Purchase Plan - ESPP'

A company-run program in which participating employees can purchase company shares at a discounted price. Employees contribute to the plan through payroll deductions, which build up between the offering date and the purchase date. At the purchase date, the company uses the accumulated funds to purchase shares in the company on behalf of the participating employees. The amount of the discount depends on the specific plan but can be as much as 15% lower than the market price.
Investopedia Says

Investopedia explains 'Employee Stock Purchase Plan - ESPP'

Depending when you sell the shares, the disposition will be classified as either qualified or not qualified. If the position is sold two years after the offering date and at least one year after the purchase date, the shares will fall under a qualified disposition. If the shares are sold within two years of the offering date or one year after the purchase date the disposition will not be qualified. These positions will have different tax implications.

Articles Of Interest

  1. Introduction To Employee Stock Purchase Plans

    ESPPs offer a very straightforward method of allowing employees to participate in the overall profitability of their employers.
  2. Expensing Employee Stock Options: Is There A Better Way?

    In 2009, Senators Carl Levin and John McCain introduced a bill to stop the excessive deductions for ESOs. But is there another solution?
  3. Your Employer's Stock: Should You Buy In?

    Many retirement plans include the offer to purchase company stock. Doing so has its advantages, but there are drawbacks too.
  4. How can I purchase stocks directly from a company?

    There are a few circumstances in which a person can buy stock directly from a company. The following is meant to cover some of these instances, which include direct stock purchase plans, dividend ...
  5. Maintaining Work/Life Balance For Financial Professionals

    Maintaining work/life balance is a challenge for most professionals in the finance industry, but it doesn't have to be that way.
  6. The Diner's Guide To Tipping

    A look at the standards for tipping service staff in some popular vacation destinations, and the rationale for each custom.
  7. 4 Traits Banks Look For In New Staff

    Trust is the number one trait that banks are looking for in new hires, but there are other abilities that are equally desired.
  8. Broker Commissions Are Here To Stay

    With two developed nations adopting a firm anti-commission stance, questions have arisen over whether or not the United States should follow suit. Find out why such a development is unlikely.
  9. 10 Great Summer Jobs For Teens

    There are a lot of summer jobs out there, find out what's available, how much it costs and what skills you need.
  10. The Path To Becoming A CEO

    Think you have what it takes to be chief executive? Find out what those at the top have in common.
comments powered by Disqus
Marketplace
Hot Definitions
  1. Xenocurrency

    A currency that trades in markets outside of its domestic borders.
  2. Wanton Disregard

    A standard of severe negligence. Wanton disregard is a very serious accusation that indicates that a person behaved extremely recklessly.
  3. Ultra ETF

    A class of exchange-traded funds (ETF) that employs leverage in an effort to achieve double the return of a set benchmark.
  4. Toehold Purchase

    A purchase of less than 5% of a target company's outstanding stockmade by an acquiring company. A toehold purchase of just under 5%, while not a significant stake in a firm, allows the shareholders a "toe-holds" grip on the company and its decision making.
  5. Samurai Bond

    A yen-denominated bond issued in Tokyo by a non-Japanese company and subject to Japanese regulations.
  6. Chartalism

    A non-mainstream theory of money that emphasizes the impact of government policies and activities on the value of money.
Trading Center
http://sp.fastclick.net/ad/tr/10858-64082-15546-0?mpt=abb3a79a7cabf0d4ab80b93d9cccf4c4