Non-Qualified Stock Option (NSO)
A type of employee stock option where you pay ordinary income tax on the difference between the grant price and the price at which you exercise the option. Investopedia Says:
NSOs are simpler and more common than incentive stock options (ISOs).
They're called non-qualified stock options because they don't meet all of the requirements of the Internal Revenue Code to be qualified as ISOs. Related Terms:
Camouflage Compensation
Employee Stock Option - ESO
Employee Stock Purchase Plan - ESPP
Incentive Stock Option - ISO
Internal Revenue Service - IRS
Non-Qualified Deferred Compensation - NQDC
Option Schedule
Overhang
Qualifying Disposition
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