Complying with nonqualified deferred compensation plan payment elections

Internal Revenue Code Section 409A contains strict rules limiting the ability of nonqualified deferred compensation plan (NDCP) participants to change their benefit commencement date (BCD) under the plan. These rules provide that, subject to certain exceptions, a change in the BCD will usually constitute an impermissible acceleration of deferral of payments under the NDCP.

In this article, Milliman’s Dominick Pizzano and White & Case’s Henrik Patel and Kenneth Barr examine how NDCP sponsors can navigate the rules to ensure their NDCP comply with Code Section 409A with respect to changes in the form of payment elections.

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