The August 31, 2007 Employee Ownership Update is online and discusses the following items: 

ESOPs Improve Performance in Closely Held Companies, But Results Are Mixed for Public Companies

The Update discussed an updated "issue brief": Employee Ownership and Corporate Performance. 

New Data on Who Gets Stock Options

The Update discussed the U.S. Department of Labor Bureau of Labor Statistics National Compensation Survey: Employee Benefits in Private Industry in the United States, March 2007: 

"A 2007 Bureau of Labor Statistics survey indicates that about 8% of all private sector employees (about 9 million people) have stock options. This is down from 9% in the 2006 survey… While the data show a predictable skewing towards higher-paid and managerial employees, they also show that millions of relatively low-paid employees, as well as non-managerial employees across all occupations, are also receiving options." 

Private Letter Ruling Suggests C ESOPs Can Go Over 25% of Pay Limit 
 

The Update also discussed a Private Letter Ruling (PLR). Here are some notes about PLR 200732028:

• IRC Section 6110(k)(3) - Precedential status provides that a Private Letter Ruling cannot be "used or cited as precedent."  
• The PLR addressed a request "concerning the deductibility of contributions under section 404(a) of the Internal Revenue Code ("Code") to an employee stock ownership plan ("ESOP")." [Watch for a post on some of the ESOP rules under IRC Section 404 - Deduction for contributions of an employer to an employees' trust or annuity plan and compensation under a deferred-payment plan] 
• The ruling concluded that a contribution to make principal payments an ESOP loan will be deductible up to 25% of compensation under IRC Section 404(a)(9)(A) - Certain contributions to employee stock ownership plans – Principal Payments. 
• The ruling concluded that a contribution to make interest payments will be deductible under IRC Section 404(a)(9)(B) - Certain contributions to employee stock ownership plans – Interest Payment. 
• The ruling concluded that additional contributions, which will not be used to pay principal or interest on the ESOP loan, will be deductible up to 25% of compensation under IRC Section 404(a)(3) - Stock bonus and profit-sharing trusts. The requesting party stated that they would amend the plan to "specifically prohibit the application of any contributions made pursuant to Code section 404(a)(3) to the repayment of either principal or interest on the ESOP Loan or any other loan described in Code Section 404(a)(9)." 
• The above deductions are provided that the aggregate of the contributions does not exceed the 415 limits, as provided under IRC Section 404(j)(1)(B) - No deduction in excess of section 415 limitation. 
• The position of this PLR is consistent with PLR 200436015.  
• Combining the 404(a)(3) and 404(a)(9) limits can be further traced back to PLR 9548036, which is discussed in this article. Please note that many of the rules and regulations have changed since it was written.