E9-30350. Employee Stock Purchase Plans Under Internal Revenue Code Section 423; Correction

AGENCY:

Internal Revenue Service (IRS), Treasury.

ACTION:

Correcting amendments.

SUMMARY:

This document contains corrections to final regulations (TD 9471) that were published in the Federal Register on Tuesday, November 17, 2009 (74 FR 59074) providing guidance to assist taxpayers in complying with section 423 in addition to clarifying certain rules regarding options granted under an employee stock purchase plan.

DATES:

This correction is effective on December 22, 2009, and is applicable on November 17, 2009.

FOR FURTHER INFORMATION CONTACT:

Thomas Scholz or Ilya Enkishev, [phone] (not a toll-free number).

SUPPLEMENTARY INFORMATION:

Background

The final regulations (TD 9471) that are the subject of this document are under sections 421, 422, 423, and 424 of the Internal Revenue Code.

Need for Correction

As published, the final regulations (TD 9471) contain errors that may prove to be misleading and are in need of clarification.

List of Subjects in 26 CFR Part 1

• Income taxes
• Reporting and recordkeeping requirements

Correction of Publication

Accordingly, 26 CFR part 1 is corrected by making the following correcting amendments:

PART 1—INCOME TAXES

Paragraph 1. The authority citation for part 1 continues to read in part as follows:

Authority: 26 U.S.C. 7805 * * *

Par. 2. Section 1.423-2 is amended by:

1. Revising the first sentence of paragraph (a)(1).

2. Revising the paragraph (d)(3).

3. Revising the last sentence of paragraph (i)(5) Example 5.

The revisions read as follows:

§ 1.423-2

Employee stock purchase plan defined.

* * * * *

(a) * * * (1) The term “employee stock purchase plan” means a plan that meets the requirements of paragraphs (a)(2) and (a)(3) of this section. * * *

* * * * *

(d) * * *

(3) Examples. The following examples illustrate the principles of this paragraph (d):

* * * * *

(i) * * *

(5) * * *

Example 5.

* * * On August 31, 2012, Q may purchase under the option an amount of FF stock equal to the difference between $75,000 in fair market value of FF stock (determined at the time the option was granted) and the fair market value of FF stock (determined at the time of grant of the option) purchased during year 2011.

* * * * *

LaNita Van Dyke,

Chief, Publications and Regulations Branch, Legal Processing Division, Associate Chief Counsel (Procedure and Administration).