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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

    Friday, August 2, 2024

  • 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.

$347.00
CLE
ALL

The CLE course will guide counsel on structuring employee severance or separation agreements to comply with Section 409A's deferred compensation restrictions. The panel will discuss best practices for performing compliance self audits and taking corrective action to remedy substantive or documentary failures.

Faculty

J. Marc Fosse
Partner
Seyfarth Shaw LLP

Mr. Fosse focuses on all the tax, securities, corporate and accounting issues related to executive and equity compensation arrangements. He works with publicly traded, private, non-profit and government clients in the design, implementation and operation of domestic and international executive nonqualified and supplemental deferred compensation plans, as well as equity-based and other long-term incentive compensation arrangements. He regularly advises clients regarding handling employee benefit matters in corporate mergers, acquisitions, divestitures, initial public offerings and other corporate transactions.

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William Fogleman
Principal
Groom Law Group Chtd - Washington

Mr. Fogleman assists clients with qualified retirement plans, nonqualified deferred compensation plans, equity and cash-based incentive compensation arrangements at public and private employers, and employment agreements and separation agreements for individual executives. He also has extensive experience with compensation and benefits issues that arise in connection with corporate transactions. He advises clients on a variety of issues, including plan design and establishment, operational issues, qualified and nonqualified plan corrections, Code section 409A issues, and IRS filings.

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Description

The IRS pursues Section 409A audit initiatives to determine companies' compliance with 409A's restrictions on the deferral of compensation. The agency focuses on compliance with initial deferral election requirements, subsequent deferral election requirements, and deferred compensation distributions, including the six-month delay rule.

Most severance arrangements fit within Section 409A and must be structured appropriately to avoid the adverse consequences imposed by Section 409A.

Specifically, failure to comply with 409A's strict rules can result in severe penalties, including a 20 percent excise tax and immediate taxes on vested deferred amounts. The IRS has ruled that an executive was required to recognize income under 409A--subject to the 20 percent penalty--because a plan document error was corrected in the vesting year even before vesting occurred.

Listen as our experienced panel of employee benefits attorneys explains the critical requirements of 409A and discusses the steps companies should take to ensure compliance. The panel will outline best practices for reviewing nonqualified deferred compensation plans, employment agreements, and other severance arrangements.

Outline

  1. 409A issues to be considered in severance plans and agreements
  2. Severance benefits subject to 409A
  3. Severance benefits exempt from 409A
  4. Impact of accelerating the vesting of equity awards upon the termination of employment on 409A
  5. Discussion of change in control severance arrangements and "regular" severance for purposes of 409A
  6. Importance of the definition of "good reason" for 409A purposes
  7. Can severance benefits that are subject to 409A be conditioned on a release?

Benefits

The panel will review these and other key issues:

  • Does 409A impact all severance plans and agreements?
  • How does 409A impact the drafting of severance plans and agreements?
  • What are some best practices for complying with 409A regulations as they relate to severance plans and agreements?