Apr 30, 2016 · A phantom stock option is characterized by which one of the following? (Phantom Stock Options) A. Board of directors compensate executives B. There are no specific conditions for converting these into shares C. There are no tax advantages D. Retirees' income tax is higher
Jul 08, 2020 · Phantom stock is an employee benefit where selected employees receive benefits of stock ownership without the company giving them actual stock. It is worth money just like real stock, and its value rises and falls with the company's actual stock (or what the company is valued at, if it's not a publicly traded company).
Oct 07, 2018 · 1.5 /1 Question 1 Which of the following usually does not constitute a second class of stock when considering S corporation eligibility? a. Convertible debentures b. Phantom stock c. Unexercised stock options Selected: d. None of these constitute a second class of stock. None of these usually constitute a second class of stock. This answer is ...
a. phantom stock plan b. incentive stock option c. restricted stock plan d. nonqualified stock option. ... Incentive stock options. Which of the following is NOT one of the clauses relating to the benefits employers can provide executives? a. Benefit plans must cover 80 percent of employees. b. Benefit plans must be determinable.
Phantom stock is an employee benefit where selected employees receive benefits of stock ownership without the company giving them actual stock. It is worth money just like real stock, and its value rises and falls with the company's actual stock (or what the company is valued at, if it's not a publicly traded company).
Most often, phantom shares are used to encourage senior leadership to produce better results.
No taxes are owed till the stocks mature. When company stocks are given to an employees, even if they have to hold onto them for a specific term, it's considered taxable income. Phantom stock doesn't have this issue and is not considered income until the bonus is paid out.
An ESOP is a qualified retirement program, similar to a pension plan. Though stocks are involved, the employee doesn't usually gain ownership of the shares. Instead, a specific number of shares is awarded to each employee, and when it's time for that employee to retire, the shares are cashed out.
However, ERISA prevents non-qualified plans to act like qualified plans, and phantom stock, if given to a large percentage of employees, may be seen as a non-qualified plan.