SHARE Plan Act

Tax Reductions for Corporations: Companies that implement these plans can receive a tax rate that is 3 percentage points lower than the standard rate (Section 2(a)).

Employee Ownership Opportunities: Employees can receive distributions of common stock or index-based mutual funds/ETfs through a SHARE plan (Section 2(d)(4)).

Tax Benefits for Employees: Stock received by an employee under a SHARE plan is excluded from their gross income, meaning it is not taxed as income (Section 3(a)).

Inclusion of Lower-Paid Workers: The bill requires that the lowest-compensated 80 percent of eligible employees participate in the periodic distributions (Section 2(d)(2)(B)).

Corporate Deductions: Corporations participating in the plan are allowed a deduction equal to the fair market value of the stock distributed during the taxable year (Section 2(f)).

Tax Rate Reduction Limits: The 3 percentage point tax reduction does not apply if the aggregate tax reductions for the corporation exceed the aggregate market value of the stock distributed (Section 2(a)).

Income Caps for Eligibility: To be considered an "eligible employee," a worker must not receive $250,000 or more in annual cash compensation (Section 2(d)(3)).

Vesting Requirements: Employees may have to wait for a period of employment—which can be up to 5 years—before the distributed stock vests (Section 2(d)(5)(A)(iii)).