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An option to purchase stock, usually granted by a company to an employee, that is not qualified as a statutory stock option (under Sections 421 and 422). Upon the grant of the option, no tax is imposed (under Section 83), but upon exercise of the option, whereby an employee actually comes into possession of stock, ordinary income taxes are imposed, with certain exceptions.
Synonyms: non-qualified stock options, nonqualified stock option, nonqualified stock options
Synonyms list (a comma-separated list)
non-qualified stock options, nonqualified stock option, nonqualified stock options