The IRS stated that it’s taking “swift and aggressive action” targeting compliance issues related to Employee Stock Ownership Plans (ESOPs), which are retirement arrangements through which employees become partial owners of their company by owning stock in it.
As part of its broader thrust to increase tax collections, the IRS stated in an Aug. 9 alert that it had identified numerous compliance issues associated with ESOPs, including certain arrangements that are potentially abusive and can amount to prohibited transactions.