Summary: H.R.1462 — 106th Congress (1999-2000)All Information (Except Text)

There is one summary for H.R.1462. Bill summaries are authored by CRS.

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Introduced in House (04/15/1999)

Employee Ownership Act of 1999 - Declares the policy of the United States that, by the year 2010, 30 percent of all U.S. corporations shall be owned and controlled by their employees.

(Sec. 3) Amends the Internal Revenue Code to provide for tax-exempt employee-owned and employee-controlled corporation (EOECC) trusts whose primary assets consist of the employer securities of an EOECC in which: (1) more than 50 percent of the voting stock is held by a trust for the benefit of the corporation's employees; (2) in all matters requiring the vote of stock, including the election of the corporate board of directors, the trustee of such trust is obligated to vote the stock held in trust and allocated to participants in the trust in the manner in which the participants direct, on the basis of one-employee one-vote (and vote any stock not so allocated as if it were so allocated); (3) at least 25 employees of such corporation are participants in and beneficiaries of such trust; (4) a minimum of 90 percent of the employees who work at least 1,000 hours annually for such corporation are participants in such trust; and (5) the trustee administers the trust for the benefit of the corporation's employees, complying with all Code requirements for employee stock ownership plans which pertain to independent appraisal of shares not readily tradable, and distribution of those shares.

Declares that: (1) there shall be no tax on the corporate income of an EOECC; and (2) the gross income of an employee owner shall not include any proceeds from the qualified sale of EOECC securities.

Exempts from inclusion in gross income of property transferred in connection with performance of services any transfer (in lieu of compensation) of EOECC securities during the three years following a corporation's election to become an EOECC.

Mandates nonrecognition of gain in the case of the sale or transfer of EOECC securities to an EOECC trust.

Establishes a credit against the estate tax for the amount of EOECC securities considered to have been acquired from or to have passed from a decedent to an EOECC trust.

(Sec. 4) Directs the Comptroller General to study and report to Congress on Federal regulations and policies affecting EOECCs.

(Sec. 5) Directs the President to establish a Presidential Commission on Employee Ownership to study and report on all issues that affect ownership of businesses in the United States, with a primary focus on the issues that affect employee ownership of such businesses.