Are your compensation arrangements in compliance?
Abstract: Late last year, the IRS gave businesses a reprieve until Jan. 1, 2009, to bring nonqualified deferred compensation arrangements and documents into compliance. The extension is welcome news for many companies that were wrestling with complex final regulations under Internal Revenue Code Section 409A. But that doesn’t mean you don’t have to comply with the regulations yet, because “good-faith” compliance with Sec. 409A itself and IRS guidelines has been required since 2005. Of course, the best way to demonstrate good faith is to continue your compliance efforts. This article looks at Sec. 409A requirements, including how they affect stock options.