To view or print the PDF content on this page, download the free Adobe® Acrobat® Reader®. December 19, 2006 Treasury, IRS Issue Final S-Corporation ESOP Regulations Washington, DC- Treasury and the IRS issued final regulations today under section 409(p) of the Internal Revenue Code with respect to an employee stock ownership plan (ESOP) that holds stock of a Subchapter S corporation. The final regulations are the culmination of a process that began when the Economic Growth and Tax Relief Reconciliation Act of 2001 enacted section 409(p), which ensures that the special tax benefits afforded to ESOPs that hold Subchapter S corporation stock do not extend to cases in which the ownership is concentrated among a small number of owners. The regulations, effective for plan years that begin on or after January 1, 2006, replace existing temporary regulations with various modifications to reflect comments received.
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