Are you required to work full time to get incentive stock options?
July 25, 2001
Subject: full-time employee requirement?
Date: Fri, 19 Jan 2001
I am planning to reduce my hours from 40 a week to 30 or 35. My employer has said that my ISO will be taken away if I do this because of the law. Is this correct?
Date: 9 Feb 2001
There is no full-time employment requirement in the Internal Revenue Code to receive or retain incentive stock options. You are only required to be an employee of the corporation granting the option, a parent or subsidiary corporation of the corporation, or a parent or subsidiary corporation of the corporation issuing or assuming a stock option in certain transactions. (IRC Section 422(a)(2).)
However, your employer’s plan may place restrictions on your options beyond those in the Internal Revenue Code.
This may be a matter you need to review with an attorney.