Tax Bill Compensation Changes – A Cause for Concern

in Executive Compensation, Section 409A, Tax Issues

The tax bill issued yesterday contains a number of provisions that, if implemented, will result in dramatic changes to the taxation of certain compensation arrangements.  Of particular concern:

  • The performance-based compensation exception to the section 162(m) $1 million compensation deduction limitation would be eliminated, and the CFO would be added to the group of executives that are subject to the 162(m) limitation.
  • Employer stock options would be treated as deferred compensation and...Continue Reading