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Course Details

Course Information
  • smart_display Format

    On-Demand

  • signal_cellular_alt Difficulty Level

    Intermediate

  • work Practice Area

    ERISA

Date & Time
  • event Date

    Tuesday, February 11, 2025

  • schedule Time

    1:00 p.m. ET./10:00 a.m. PT

  • timer Program Length

    90 minutes

Credit Information

  • This 90-minute webinar is eligible in most states for 1.5 CLE credits.

  • BARBRI is a NASBA CPE sponsor and this 110-minute webinar is accredited for 2.0 CPE credits.

$347.00
CLE
CPE
ALL

This CLE/CPE course will provide program attendees with a detailed analysis of the tax implications of nonqualified deferred compensation under Section 409A of the Internal Revenue Code. The panel will discuss the background of Section 409A, basic Section 409A rules, definitions and exceptions, the initial and subsequent deferral election rules, the six-month delay requirement, the plan aggregation rules, penalties and corrections under Section 409A, common Section 409A pitfalls, and other issues under Section 409A (including those that frequently arise in the context of M&A transactions).

Faculty

Shalom D. Huber
Partner
Skadden Arps Slate Meagher & Flom LLP

Mr. Huber regularly advises clients on the design and implementation of compensation and benefits arrangements, including employment and severance agreements; consulting arrangements; retention, severance and change-in-control plans; cash and equity-based incentive compensation plans; and nonqualified deferred compensation plans. In addition, he frequently advises clients regarding the tax rules relating to deferred compensation, the excise tax on “golden parachute” payments and the limits on deductibility of executive compensation. He also advises on the SEC rules governing executive compensation disclosure, including annual proxy disclosure and peri­odic reports, as well as on various ESG-related issues.

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Michael A. Wiseman
Partner
Skadden Arps Slate Meagher & Flom LLP

Mr. Wiseman counsels companies, boards of directors, independent and compensation committees, executive management teams and members of management on executive compensation matters that arise in the ordinary course of business and with respect to extraordinary events, including leadership transitions. He also regularly provides tax planning advice with respect to Internal Revenue Code Sections 409A and 162(m), as well as the excise tax on “golden parachute” payments under Sections 280G and 4999 and related sections. In addition, Mr. Wiseman assists clients with the design and implementation of equity- and cash-based incentive plans and awards, profit and capital interest participation in partnership and LLC arrangements, and executive and nonexecutive employment, severance, retention and change-in-control programs and agreements. He also frequently advises clients regarding SEC rules governing compensation- and benefits-related disclosures, equity-related registration requirements, and exemptions and compliance with related rules under NYSE and Nasdaq listing standards.

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Description

A nonqualified deferred compensation plan is a plan that provides a legally binding right in one taxable year to compensation that is or may be payable in a later taxable year. A surprisingly broad range of commonplace compensation agreements, plans and programs (including many employment agreements, severance plans, and equity-based awards) may qualify as nonqualified deferral compensation plans within the meaning of Section 409A.

Nonqualified deferred compensation plans are ripe with potential tax pitfalls. To avoid taxes and penalties under Section 409A, counsel, compensation advisers and HR/Total Rewards executives must have knowledge relating to the following: (1) the reach of Section 409A, (2) the common exceptions from Section 409A (such as the short-term deferral exception and separation pay plan exception), (3) the permitted payment events that comply with Section 409A (such as payments on death, disability, unforeseeable emergency, separation from service, change in control, and payment on a specified payment date), and (4) the corrections and solutions available, or unavailable, if a compensation arrangement violates Section 409A.

Listen as our panel discusses the background and application of all aspects of Section 409A.

Outline

  1. Background of Section 409A
  2. Basic Rules and Exceptions
  3. Penalties and Corrections
  4. Practical Issues and Specific Rules
  5. Common Pitfalls and Questions
  6. Common Section 409A Issues in M&A

Benefits

The panel will discuss these and other key issues:

  • What is a nonqualified deferred compensation plan?
  • What is the impact of being subject to Section 409A?
  • What are common exceptions to Section 409A?
  • When does the six-month delay requirement apply?
  • How common are audits relating to Section 409A?
  • What kind of voluntary correction programs are available under Section 409A?

NASBA Details

 

Learning Objectives

After completing this course, you will be able to:

  • Appreciate the breadth of Section 409A
  • Understand the implications of being subject to Section 409A
  • Identify key rules and exceptions under Section 409A
  • Identify common pitfalls under Section 409A

  • Field of Study: Taxes
  • Level of Knowledge: Intermediate
  • Advance Preparation: None
  • Teaching Method: Seminar/Lecture
  • Delivery Method: Group-Internet (via computer)
  • Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
  • Prerequisite: Three years+ business, legal or public firm experience at mid-level within the organization, providing tax planning and preparing complex tax forms and schedules for partnerships and LLCs; supervisory authority over other preparers/accountants. Knowledge and understanding of partnership and LLC structure, equity compensation in these entities; familiarity with equity compensation alternatives and equity interest for pass-through entity employees, members and partners.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.