Reviewing executive compensation and 409A compliance

The passage of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, as well as general liquidity and business continuity concerns resulting from the financial effects of COVID-19, have created circumstances calling for reductions in executive compensation. However, employers and employees must carefully consider how any reductions are implemented to remain compliant with Internal Revenue Code Section 409A.

In this article, Milliman’s Dominick Pizzano and White & Case’s Henrik Patel and Kenneth Barr review executive compensation issues that should be examined during these turbulent times.