What is EMPLOYEE STOCK OWNERSHIP PLAN (ESOP)?

In the United States, a program where a company provides shares of its COMMON STOCK to employees through a TRUST. The program builds employee ownership and aligns employee/investor interests, and creates a tax deduction for the company.

More On This Topic
  1. How To Fire An Employee The Right Way
  2. Understanding Section 79 Plans With Permanent Life Insurance
  3. Nepotism, Cronyism, & Favoritism: Illegal Or Unethical?
  4. Difference Between A Profit Sharing Plan & A Thrift Saving Plan
  5. When A Company Files for Chapter 11 Bankruptcy Court Protection What Happens to the Stock?
  6. Can I Deduct Mortgage Interest on a Home Outside of the U.S.?
  7. Three Conditions Required For Respondeat Superior
  8. Writing An Employee Handbook: 10 Essential Things To Include
  9. Seven Factors Every Business Owner Must Know About Independent Contractor Law
  10. What Are the Tax Implications of Life Insurance Premiums for Corporate Officers?

Related Legal Terms
EMPLOYEE SHARE OWNERSHIP PLAN (ESOP), EMPLOYEE STOCK OPTION PLAN, EMPLOYEE PROFIT SHARING PLAN (EPSP), LEVERAGED ESOP, EMPLOYEE PENSION BENEFIT PLAN, REGULAR STOCK OPTION PLAN, SIMPLIFIED EMPLOYEE PENSION PLAN, STOCK SUBSCRIPTION PLAN, STOCK BONUS PLAN, EMPLOYEE TRUST


Link to This Definition
Did you find this definition of EMPLOYEE STOCK OWNERSHIP PLAN (ESOP) helpful? You can share it by copying the code below and adding it to your blog or web page.
Written and fact checked by The Law Dictionary