Section 162(m)

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White & Case ECB News – Issue 1, 2015

How global events shape local labour laws - Giving employers the better deal? The global economic crisis squeezed corporate profits, reduced demand for goods and services and shrank workforces. Now, new labour laws...more

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

In 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...more

IRS Updates Guide to Auditing Nonqualified Deferred Compensation Plans

The Internal Revenue Service (IRS) recently updated its “Nonqualified Deferred Compensation Audit Techniques Guide.” The Guide provides a framework for the IRS to audit nonqualified deferred compensation (NQDC) plans. Since...more

Final Regulations on Section 162(m) Deduction Limit Exceptions

New final regulations(the “Final Regulations”) have been issued clarifying and altering the “qualified performance-based compensation” exception and the transitional “reliance period” exception for newly public companies to...more

Practical Advice for Compliance with Recent Amendments to the Internal Revenue Code Section 162(m) Regulations

The recent amendments to the Section 162(m) regulations largely follow the changes set forth in the proposed regulations issued in 2011, clarifying two exceptions from the Section 162(m) tax deductibility limit...more

IRS Publishes Final Regulations Under Section 162(m)

On March 31, 2015, final regulations of Internal Revenue Code Section 162(m) were published. The final regulations clarify exceptions to the US$1 million annual limit on deductions allowable to publicly held corporations for...more

IRS Addresses Interaction of Performance Compensation and $1M Compensation Deduction Cap

The IRS recently issued final regulations under Section 162(m), which limits a public company’s deduction of executive compensation in excess of $1M.  The Section 162(m) limits do not apply to performance-based compensation...more

IRS Releases Clarifying 162(m) Regulations

The IRS recently released final regulations clarifying two aspects of the “performance-based compensation” exception to the $1,000,000 limit on deductible compensation paid to covered employees under Section 162(m) of the...more

Executive Compensation Alert: IRS Releases Final Section 162(m) Regulations

Background - Section 162(m) of the Internal Revenue Code (the “Code”) denies a tax deduction to a public company if the compensation paid to its chief executive officer and three other highest compensated officers...more

A Phantom Menace for IPO Companies - US Tax Regulations Restrict the Use of Restricted Stock Units

Section 162(m) of the Internal Revenue Code (“Section 162(m)”) provides for a $1 million dollar limitation on the amount of compensation paid to each of certain named executive officers that public companies may deduct in any...more

Final 162(M) Rules Have A Surprise For Newly Public Companies

The final Section 162(m) regulations issued by the IRS last week have a small but welcome surprise for companies that have recently become public....more

EXTRA! EXTRA! FASB Eliminates Extraordinary Items; Impact on Section 162(m) Plans

Public company incentive plans that are designed to comply with the "performance-based compensation" rules under Section 162(m) of the Internal Revenue Code often include language that permit the exclusion of certain events,...more

Locke Lord QuickStudy: IRS Clarifies Performance-Based Compensation Exception Under Code Section 162(m)

On March 31, 2015, the Internal Revenue Service (IRS) published final regulations under Section 162(m) of the Internal Revenue Code (the Code). Code Section 162(m) disallows a deduction by any publicly-held corporation for...more

"Executive Compensation: Avoiding Proxy Litigation and Say-on-Pay Pitfalls in 2014"

The spotlight on executive compensation further intensified during 2013, the third season under the Dodd-Frank Act’s “say-on-pay” rules, with the release of additional disclosure requirements and increased risks of...more

Planning for the 2014 Annual Meeting and Reporting Season

In This Issue: - Incorporate lessons from 2013 say-on-pay results - Prepare for new Form SD (Specialized Disclosure) filing requirements - Ensure compliance with revised listing standards related to compensation...more

Delaware Federal Court Issues Significant Ruling Concerning Impact of Executive Compensation Provisions of the Internal Revenue...

In a case of apparent first impression regarding the impact of the shareholder voting provisions of Internal Revenue Code I.R.C. § 162(m)on state corporate law, Judge Sue L. Robinson of the U.S. District Court for the...more

Reminder: Check Compliance With Code Section 162(m) Requirements to Deduct Performance-Based Compensation

Compensation paid by a publicly traded company to its chief executive officer and its three other most highly compensated officers (other than its chief financial officer) is generally not deductible by the company to the...more

Planning for the 2013 Annual Meeting and Reporting Season

As companies prepare for the 2013 annual meeting and reporting season, we have compiled an overview of the corporate governance and disclosure matters that companies should consider as they draft this season’s disclosure...more

Freedman v. Adams, et al., C.A. No. 4199 (Del. Jan. 14, 2013)

In this en banc opinion, the Delaware Supreme Court affirmed the Court of Chancery’s decision in Freedman v. Adams, et al., C.A. No. 4199-VCN (Del. Ch. Mar. 30, 2012), denying the plaintiff’s motion for an award of attorney’s...more

Defending Section 162(m) Executive Compensation Derivative Suits in the United States

Decisions regarding executive compensation fall squarely within the discretion of a public company’s board of directors. Recently, however, plaintiffs’ firms have been trying to invade the board’s purview by bringing...more

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