Deferred Compensation (Currently Unavailable)

Author: Jennifer Kowal

Deferred Compensation Pitfalls and Opportunities for Stock, Annunities, and Life Insurance
A large portion of the rise in executive pay over the last two decades has come in the form of deferred compensation. Stock based compensation, annuities, and life insurance policies, in addition to more traditional nonqualified deferred compensation plans, are all common means of compensating highly paid executives.

This on-demand course addresses the numerous tax rules that reach deferred compensation arrangements and often discourage their use, including IRC Sections 162(m), 409A, and 280G, It also addresses the taxation of common incentive based compensation arrangements such as stock appreciation rights and payments triggered upon changes in control. Finally, it will briefly address SEC rules such as the "say for pay", "pay ratio", and "performance based compensation rules."

Publication Date: August 2018

Designed For
Tax practitioners at all levels who advise on the taxation of deferred compensation.

Topics Covered

• Section 409A's penalty provisions affecting deferred compensation
• Section 162(m) and section 280G
• SEC rules applying to executive compensation, including pay ratio, say on pay, and pay for performance
• Tax consequences of compensation based life insurance policies and annuities
• Tax consequences of various perquisites

Learning Objectives

• Identify situations where IRC rules may limit or disallow deduction of executive compensation payments
• Describe situations in which penalty taxes may apply to payments received by executives
• Differentiate pay ratio and pay for performance rules
• Recognize key elements of annual executive compensation
• Differentiate compensation with respect to executive compensation
• Recognize examples of appreciation only award
• Identify correct statements with respect to private companies
• Identify characteristics of the constructive receipt docrtine
• Describe Section 409A
• Recognize exempt types of compensation requirements under Section 409A
• Identify characteristics of fabricating with respect to the concept of backdating
• Identify referenced tax provisions ties the employer deduction to the timing of the employee's income inclusion
• Differentiate Congressional acts and how they apply
• Recognize correct statements regarding interests in partnerships and LLCs
• Identify fringe benefits and how they apply to client scenarios
• Identify equity-based award gives the right to purchase stock on a specified date
• Recognize what percent of large CEO pay is represented by stock awards, according to HBR
• Identify one of the two exceptions which may accelerate compensation in the case of deferred compensation
• Differentiate Code Sections in relation to deferred compensation
• Recognize the requirements of backdating

Level
Basic

Instructional Method
Self-Study

NASBA Field of Study
Taxes (4 hours)

Program Prerequisites
None

Advance Preparation
None