NSO

Business & Finance abbreviation · Human Resources

NSO
Stands forNonqualified stock option
CategoriesBusiness & Finance

NSO stands for Nonqualified stock option, a human resources abbreviation.

Stock option that does not meet the requirements for incentive stock option treatment, so the spread between market value and exercise price is taxed as ordinary income when exercised. Companies can grant NSOs to employees, directors, advisors and contractors.

Example: Our advisors receive NSOs because ISOs are limited to employees.

Usage notes

Also written NQSO. For employees, the exercise spread is reported on the W-2 and subject to payroll taxes. The company gets a tax deduction equal to the income recognized, an advantage ISOs do not give the employer.

More human resources abbreviations

  • L&D – Learning and development
  • LMS – Learning management system
  • LOA – Leave of absence
  • LTI – Long-term incentive
  • MSP – Managed service provider
  • NCNS – No call, no show
  • OD – Organization development
  • OE – Open enrollment
  • OT – Overtime
  • OTE – On-target earnings
  • PEO – Professional employer organization
  • PFL – Paid family leave

See all 86 human resources abbreviations →

Edited by the AbbreviationList.com team. Spotted an error or a missing meaning? Contact us.