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§409A: New Document Corrections Program for Nonqualified Plans

Product Code - TMAU32
Speaker(s): Steven B. Tackney, Brigen L. Winters, Jeffrey W. Kroh
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Get ready. The IRS is signaling more §409A enforcement. The agency's recent audit activity and document requests requiring comprehensive disclosures about plans and individuals subject to §409A confirm this trend. Plan document and operational errors should be identified and corrected to avoid heavy tax penalties.

Our panel of experts from the IRS and a leading law firm analyze new IRS guidance on correcting §409A plan document failures and discuss opportunities and potential pitfalls under the guidance. The panel identifies commonly occurring hazards -- including ambiguous plan terms and impermissible definitions and payment events, to name just a few -- and offers practical solutions to help you avoid costly and damaging results.

Program highlights include:

• Identifying opportunities to correct certain document failures with limited or no income inclusion or additional taxes
• Reviewing the scope of this relief based on whether the correction affects plan operation within one year of the correction
• Analyzing common document correction scenarios and any related operational correction requirements
• Highlighting clarifications in the new guidance that certain common plan provisions do not result in document failures
• Noting clarifications to the operational correction program in the new guidance
• Discussing any alternatives to the operational and document correction programs

The objectives of this Webinar include providing participants with an understanding of the IRS’s new correction program for certain types of failures of nonqualified deferred compensation plans to comply with §409A. Upon completion of the program, participants will be able to:

• Describe the correction program guidance
• Understand how the new program fits with earlier IRS guidance on plan corrections
• Identify commonly occurring §409A failures to comply
• Understand the risks associated with §409A noncompliance and the possible opportunities created by the IRS guidance
• Apply correction principles to client plans

Steven B. Tackney, Brigen L. Winters, Jeffrey W. Kroh

Stephen B. Tackney, Senior Counsel, Office of Chief Counsel, IRS, Washington, DC

Brigen L. Winters is a principal at Groom Law Group, Chartered, where he co-chairs the firm's Policy and Legislation practice group and also works with the firm's Executive Compensation, Plan Design and Taxation, Multiemployer/Taft-Hartley Plans, and Health and Welfare practice groups. His practice includes counseling plan sponsors and financial institutions regarding deferred compensation, tax-qualified, and health and welfare arrangements, and advising individual employers, coalitions, and trade associations on legislative and regulatory matters.
Mr. Winters returned to the firm in January 2002 after serving for three years as majority tax counsel to the House Committee on Ways and Means. Over the last several years, Mr. Winters has worked extensively on executive and nonqualified deferred compensation issues, including compliance and plan design issues related to Section 409A. He has also worked extensively on the pension funding and other changes that were enacted as part of the Pension Protection Act of 2006.

Jeffrey W. Kroh is a principal at Groom Law Group, Chartered and works with the firm's Executive Compensation and Plan Design and Taxation practice groups. His practice focuses on the design and administration of executive deferred compensation plans, equity compensation plans, and qualified retirement plans for large public and private companies. Prior to Groom, he worked on matters relating to a broad spectrum of tax, securities law, and ERISA issues as an employee benefits generalist. He has written articles and assisted clients on various topics relating to executive compensation such as the design and compliance of nonqualified deferred compensation arrangements under Section 409A, TARP restrictions for certain financial institutions, annual and long-term bonus plans, change in control and severance arrangements, equity compensation, and other "top-hat" plan and deferred compensation issues.