IRS Extends Option Comment Period

January 29, 2002 ( - The Internal Revenue Service (IRS) will accept public comment for two more months on new rules governing Social Security and unemployment taxes due after the exercise of certain stock options.

The new public comment deadline on REG-142686-01 is April 23.

Tax officials specifically asked for input about:

  • the clarity of the proposed regulations
  • how well they could be administered.

The proposed rules cover stock received on the exercise of an incentive stock option issued under Section 422(d) of the US Tax Code as well as those issued as part of an ESOP covered in Section 423(a).

Along with the rules proposal, the IRS put out two “rules of administrative convenience” to help companies handle the payment of Federal Insurance Contribution Act and Federal Unemployment Tax Act taxes.

A public hearing was also postponed until May 14.