Executive Compensation-IRS Modifies The Relief And Guidance It Previously Provided On The Correction Of Certain Failures Of A Nonqualified Deferred Compensation Plan to Meet Section 409A - Posted by Stanley D. Baum

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Executive Compensation-IRS Modifies The Relief And Guidance It Previously Provided On The Correction Of Certain Failures Of A Nonqualified Deferred Compensation Plan to Meet Section 409A
December 2, 2010

Posted In: Executive Compensation
By Stanley D. Baum on December 2, 2010 9:52 AM | Permalink

The IRS has issued Notice 2010-80. This notice modifies certain provisions of Notice 2008-113 and Notice 2010-6, dealing with the correction of failures to comply with Section 409A of the Internal Revenue Code (the "Code"), by:

• Clarifying that the types of plans eligible for relief under Notice 2010-6 include a
nonqualified plan linked to a qualified plan or another nonqualified plan, provided
that the linkage does not affect the time and form of payments under the plans;

• Expanding the types of plans eligible for relief under Notice 2010-6 to include
certain stock rights that were intended to comply with the requirements of
Code Section 409A(a) (rather than be exempt from the requirements of Section 409A(a));

• Providing an additional method of correction under Notice 2010-6 for certain
failures involving payments at separation from service subject to the requirement
to submit a release of claims or similar document; and providing transition relief
permitting the correction of such failures that were in effect on or before
December 31, 2010 (including relief from the service provider information
reporting requirements);

• Providing relief from the service provider information reporting requirements
under Notice 2010-6 for corrections made under the transition relief ending
December 31, 2010; and

• Providing relief from the requirement that service recipients furnish certain
information to service providers under Notice 2008-113 for corrections made in
the same taxable year as the failure occurs.

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