nonqualifying stock option

nonqualifying stock option definition - business

nonqualifying stock option

An option to purchase stock that does not meet certain requirements established by the Internal Revenue Service for favorable tax treatment. Acting on a nonqualifying stock option results in taxable ordinary income on any gain made during the year the option is exercised. Compare incentive stock option.

The American Heritage® Dictionary of Business Terms Copyright © 2009 by Houghton Mifflin Harcourt Publishing Company. Published by Houghton Mifflin Harcourt Publishing Company. All rights reserved.

Comments
Improve this definition.
Do you have more to add? Share your linguistic knowledge or observation.
/Register to save your comments.