Legal updates for: 409A

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IRS Retirement Plan Limitations for 2016

by Miller Canfield on

... whose stock is publicly-traded and that sponsor a non-qualified deferred compensation plan which is subject to Code Section 409A, a “key employee” who participates in the plan cannot receive an employment termination distribution fro... more

Proposed rules under section 707 governing disguised compensation for services

by Dentons on

... proposed Department of Treasury regulations under IRC section 707(a)(2)(A) set forth standards to determine when a payment arrangement to a partner shall be treated as disguised compensation. Section 707(a) generally governs payments to partners who render services to a partnership other than in a partner capacity. Additionally, the rules will... more

How to Prevent Poaching of Your Startup's Employees

by JD Supra Perspectives on

...Employee “poaching” is a fact of life in many industries. Such employee recruiting is not intrinsically illegal, as a matter of public policy the law generally favors the ability of employees to freely switch employers. However, there are steps that companies can take to reduce the likelihood of poaching.... more

Alert: IRS Announces Adjusted Plan Limits for 2016

by Cooley LLP on types of employee benefit plans, including deferred compensation plans that may be subject to Internal Revenue Code §409A. The amount by which the limits are adjusted each year is based on a cost of living index. Not all limits increase every yea... more

Blog: Secondary Sales of Private Company Stock

by Cooley LLP on

... years past, a private company stockholder would have expected to wait until the company went public or was acquired to receive any return on investment. However, over the last several years, stockholders in many private companies have participated in so-called “liquidity rounds”, sometimes referred to as secondary sales, in which they... more

Proposed Regulations Require Significant Entrepreneurial Risk for a Service Partner's Income to be a Distributive Share

by McDermott Will & Emery on

... July 22, 2015, the U.S. Department of the Treasury and the Internal Revenue Service (IRS) released proposed regulations under Section 707(a)(2)(A) (the proposed regulations) which would treat certain partnership distributions as disguised payments for services taxable as ordinary income. Section 707(a)(2)(A), which was added to the Internal... more

Know Your Limits! Section 162(m) and Excess Equity Grants

by King & Spalding on

... the past few years there has been an uptick in stockholder derivative litigation related to equity compensation granted to named executive officers that exceed the plan share limits. The claims against the companies include breach of fiduciary duty, waste of corporate assets, unjust enrichment and false or misleading disclosures. At the core of... more