In an IRS Field Attorney Advice Memorandum (FAA 20134301F) dated September 18, 2013, the IRS Office of Chief Counsel reviewed several common bonus plan designs in connection with a request for an opinion with regard to the timing of the employer’s tax deduction with respect to the accrual and payment of bonuses. Under the plans
Understanding Employee Benefits and key developments in the employee benefits field and items of interest to our clients. MORE
Deferred Compensation
New York Taxes a Portion of Stock Option Gain of Nonresident Retiree
By Stinson LLP on
Like a number of states, New York requires nonresidents to pay income taxes on wages earned in the state. Those rules extend to an allocable portion of deferred compensation and gain from the exercise of stock options earned while employed in the state. The state’s ability to tax a nonresident is limited to this extent: …
Certain Employment and Severance Agreements May Need to Be Amended by 12/31/12 to Avoid 409A Penalties
By Jeffrey Cairns on
In IRS Notice 2010-6 and Notice 2010-80, the IRS expanded rules outlined in the 2007 Final Regulations under Code Section 409A to describe a potential violation of that Section where certain severance type payments are made upon the execution of a release (or the expiration of a statutory rescission period). While certain severance agreements are…
Not All Courts Agree With The Eighth Circuit
By Stinson LLP on
I blogged recently about an Eighth Circuit decision concluding that an agreement with a single employee cannot be an ERISA plan because a plan necessarily requires more than one participant. Other courts disagree. Recently the United States District Court for the District of Idaho in the case of Knoll v. Moreton Insurance of Idaho, Inc…