U S Treasury and deferred compensation plans

Flexibility Offered for Deferred Compensation Plans of Tax-Exempt Organizations, Government Agencies

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Flexibility Offered for Deferred Compensation Plans of Tax-Exempt Organizations, Government Agencies

U S Treasury and deferred compensation plansThe article posted below was published by JD Supra Business Advisor, and authored by Brian Pinheiro and Diane Thompson of Ballard Spahr LLP. Originally released June 23, 2016, the article looks at two sets of proposed regulations under Sections 457 and 409A of the Internal Revenue Code.

The U.S. Treasury Department has issued the proposed regulations, relating to deferred compensation plans of state and local governments and tax-exempt organizations, including:

  • Health Systems
  • Universities
  • Foundations
  • Other nonprofit entities

The article includes an in-depth look at the highlights of the new proposed regulation. A public hearing on the proposed changes is scheduled for this fall. As Pinheiro and Thompson observed, it is important that:

All state and local government employers, and all tax-exempt employers, should review their deferred compensation, severance, and paid-time off arrangements in light of the new proposed regulations. Some adjustments to the arrangements may be needed to maintain compliance, but there also may be opportunities to take advantage of the unexpected flexibility contained in the proposed regulations.”

You can read the full text of the article below.