A bill to amend the Internal Revenue Code of 1954 to facilitate the acquisition and ownership of all, or substantially all, of the stock of an employer by employees through an employee stock ownership plan, and for other purposes.

Amends the Internal Revenue Code to allow an employer an income tax deduction for contributions to an employee stock ownership plan (ESOP) which owns all, or substantially all, of the outstanding qualifying employer securities of such employer, and such contributions are applied to the repayment of principal and interest on a loan incurred by the plan for the purpose of acquiring such securities. Limits the deductible amount to a maximum 25 percent of the compensation otherwise paid or accrued to all employees under the plan for the taxable year.

Allows any ESOP to retain its qualified status even though it provides for cash distributions and denies any participant the right to demand a distribution in the form of employer securities.

Exempts such an ESOP from the limitations otherwise imposed on annual additions to an employee stock ownership plan.

Allows such an ESOP to elect irrevocably to use the book value as the fair market value of employer's securities for the purpose of determining the value of participants' accounts under the plan.

Exempts from the requirement that employer securities must stay in the plan securities distributed as a benefit to a participant as the result of a transaction in which the employer ceases to be a member of a controlled group of corporations with the corporation whose stock constitutes employer securities under the plan.