The NASPP Blog

October 13, 2009

Cricket Players and Stock Options

I have a smorgasbord of stock-option tidbits for you this morning, including a tax withholding rate increase in CA, a directory of financial advisors for employees, and a cricket team that is considering granting stock options to its players.

Withholding Rate Increases in California
Effective November 1, the withholding rate applicable to stock options and bonuses will increase to 10.23% (from 9.3%). Restricted stock and units are also subject to this rate.

The increase is part of the 2009-2010 fiscal budget changes. Personal income tax rates have remained the same in CA, so this doesn’t change the amount of CA income tax employees have to pay on their stock options and awards, it merely increases the amount that is paid up front, at the time a transaction occurs (via withholding). If the extra withholding results in an overpayment, employees will be entitled to a refund when they file their CA tax returns.

See the CA Employment Development Department’s press release on the increase.

Thanks to Raul Fajardo of Qualcomm for bringing this to our attention.

Financial, Et. Al., Advice for Employees
We’ve all had to tell employees that they should discuss their stock compensation with a financial advisor and then been at a loss to tell them where to go to find one. Now myStockOptions.com is offering a solution–a specialized directory of financial, legal, and tax advisors with an expertise in stock compensation.

The directory is free for employees and executives and can be searched by region, fee structure, minimum portfolio, experience, and type of advice offered (legal, financial, or tax).

Stock Options Where You Least Expect Them
I get a daily Google alert on the phrase “stock options” (which sometimes yields some odd results, but that’s for another blog) that always includes several stories on companies granting stock options to their employees. I usually just skim over them, but one caught my eye recently: “Deccan Chargers indicates IPO, stock options.” The Deccan Chargers are a professional cricket team in India; apparently they are considering an IPO and, if they go through with it, they would offer stock options to their players. Cricket players and stock options, who would have guessed?

10 pts to anyone who can explain how the game of cricket is played in 100 words or less.

Quick Survey on Global Stock Plans
Take a moment to complete the NASPP’s quick survey on global stock plans. With less than ten questions, you can complete the survey in just five minutes!

NASPP Conference Workshop of the Week
This week’s workshop is “Bullseye! Ensuring Your Performance Plan is On Target.” This panel will explore the conflicting considerations that companies face when designing performance plans as well as highlight practical strategies for resolving challenges such as the CD&A requirement to disclose targets versus the desire to maintain confidentiality; maximizing tax deductions under Section 162(m) at the expense of committee discretion; and the yearning for simplicity in drafting, while still anticipating contingencies that can spoil the best laid plans.

NASPP “To Do” List
We have so much going on here at the NASPP that it can be hard to keep track of it all, so I keep an ongoing “to do” list for you here in my blog. 

– Barbara