Summary: H.R.2741 — 104th Congress (1995-1996)All Information (Except Text)

There is one summary for H.R.2741. Bill summaries are authored by CRS.

Shown Here:
Introduced in House (12/07/1995)

ESOP Promotion Act of 1995 - Amends the Internal Revenue Code to allow S corporations (certain small business corporations) to participate in employee stock ownership plans (ESOPs).

Allows ESOP closely-held corporate sponsors to pay estate tax if an estate transferred the stock of the corporation to an ESOP.

Allows the deductibility of ESOP dividends in computing alternative minimum tax if such dividends were paid on employee securities held by an ESOP established or authorized to be established before March 15, 1991.

Excludes from gross income transfers of qualified securities in connection with the performance of services if such securities are sold to an ESOP within 60 days of the taxable event.

Revises the voting rights requirement for an ESOP under the exclusion for interest on certain loans used to acquire employer securities by requiring that: (1) the employer of the plan has a registration-type class of securities; or (2) the plan allows each participant one vote.

Allows for a qualified gratuitous transfer of remainder interest in qualified employer securities to an ESOP following the termination of payments to a charitable remainder annuity trust or a charitable remainder unitrust.

Provides that securities acquired by an ESOP in a qualified gratuitous transfer allocated to any person who is related to the decedent or to any person who is a five percent shareholder be treated as having been distributed.