The IRS has issued new correction procedures for plans and agreements that fail to comply with the complex new rules governing deferred compensation (including severance pay) under §409A of the Internal Revenue Code. Unlike previous correction procedures which dealt with failures to properly administer a plan, the new procedures allow plans and agreements to be amended to correct many plan documents. The IRS has made it clear that it views §409A as a high audit priority, and that it intends to go after plans and agreements that are drafted incorrectly even if no §409A violation has occurred in practice.
Join experienced members of Seyfarth Shaw’s Employee Benefits and Executive Compensation Department for a practical discussion of how to take advantage of the new IRS guidelines in order to avoid the severe tax penalties imposed by §409A. Topics will include:
- Revising severance agreements and plans that require a release as a condition to receipt of benefits.
- Identifying and correcting improper payment schedules.
- Adding the six month payment delay for key employees to existing plans.
- Correcting reimbursement policies.
- Correcting improper definitions and payment triggers, including termination of employment and change in control.
- What needs to be done by the end of 2010 to take advantage of the transition rules.
If you have any questions, please contact Raegan Pangonis, firstname.lastname@example.org