On June 21, 2016, the IRS issued some proposed regulations which clarify or modify certain provisions of IRC Section 409A which have an impact on non-qualified deferred compensation and stock plans. Some of the proposed regulations have an effect on employee stock options (ESOs), restricted stock units (RSUs), and stock appreciation rights (SARs). Prior to this issue, the IRS had provided informal guidance on a case-by-case basis.
Although the text of the proposed regulations is lengthy, excellent commentary has been provided by a number of law and public accounting firms.
If you have any questions with respect to compliance with Section 409A, please contact Montgomery Investment Technology, Inc.