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Treasury/IRS Release Proposed Regulations on Section 4960 Excise Tax

The US Department of the Treasury has released long-expected proposed regulations regarding the section 4960 excise tax on certain remuneration or separation amounts paid to the five highest paid employees of a tax-exempt organization. The new proposed regulations continue the tough approach previously taken on section 4960 issues, while also providing some new exceptions and important clarifications. Access the full article.

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Top Takeaways for Tax-Exempts from IRS Guidance on Executive Compensation

One of the more controversial and complex provisions of the Tax Cuts and Jobs Act has been the 21 percent excise tax on certain nonprofit executive compensation. On December 31, 2018, the IRS issued interim guidance that addresses how this tax will apply in various situations that commonly arise for tax-exempt employers. Establishing internal systems to comply with this guidance will be challenging. Access the full article.

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How the Tax Act Upsets the Board/Executive Compensation Committee Dynamic

Michael Peregrine and Ralph DeJong wrote this bylined article about what they called the “enormous consequences” for tax-exempt hospital senior executive compensation due to the new Tax Cuts and Jobs Act provisions that place an excise tax on executive compensation and benefits. “From a corporate governance perspective, the significance of these new provisions carries the potential for recalibrating the relationship between the board and its executive compensation committee,” the authors wrote. Continue Reading. Originally published in Bloomberg BNA's Health Law Reporter, January 2018.

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Internal Revenue Service Updates Golden Parachute Payments Audit Technique Guide, Signaling Key Items IRS May Review on Audit

In early 2017, the IRS updated its Golden Parachute Payments Audit Technique Guide for the first time since its 2005 issuance. While intended as an internal reference for IRS agents conducting golden parachute examinations, the Audit Technique Guide offers valuable insight for both public and private companies, and recipients of golden parachute payments, into how IRS agents are likely to approach golden parachutes when conducting an audit. Continue Reading.

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