ESOPs are increasingly a popular succession planning vehicle, and well they should be. When formed properly, an ESOP transaction preserves the legacy of the business that an owner helped create, while providing tax and financial benefits to the former business
Employee Benefits Law Report
Reporting on recent legal developments and trends affecting employee benefits
Blog Authors
Latest from Employee Benefits Law Report
Unanimous Supreme Court provides victory to plaintiffs in ERISA fee litigation
But just how big of a win is it?
The U.S. Supreme Court recently issued a unanimous decision in Hughes v. Northwestern University, reversing and remanding a lower court ruling that had dismissed the case against a retirement plan…
DOL proposes new ERISA fiduciary ESG and proxy voting rules
In what some commentators are describing as the latest volley in a game of regulatory ping-pong, the Department of Labor (DOL) published proposed regulations that would change the way an ERISA fiduciary should consider environmental, social and governance (ESG) issues…
Plan sponsors now have a deadline for providing lifetime income illustrations
Employers who sponsor 401(k) plans and other defined contribution plans in which participants may direct the investments of their accounts now have a deadline to provide lifetime income illustrations in those plans’ benefit statements. The Department of Labor (DOL) recently…
IRS updates Nonqualified Plan Audit Technique Guide—Is a new enforcement initiative on the horizon?
The Internal Revenue Service (IRS) recently updated its Nonqualified Deferred Compensation Audit Techniques Guide (NQDC). It released Publication 5528 (NQDC guide) on June 1, 2021. The IRS last updated the NQDC Guide in 2015. Interestingly, the 2015 NQDC Guide was…
DOL confirms cyber security is an ERISA fiduciary issue and issues guidance for retirement plan sponsors, service providers and participants
The U.S. Department of Labor (DOL) recently announced new guidance for plan sponsors, fiduciaries, record keepers and participants on best practices for maintaining cyber security. This is the first time the DOL has issued such guidance, and it comes in…
For public companies, the time to update executive compensation practices is now: Final regulations issued under IRC Section 162(m) and American Rescue Plan Act further expands class of covered employees
By Dave Tumen & Greg Daugherty
At long last, the Department of the Treasury and Internal Revenue Service published final regulations to explain how changes to Internal Revenue Code Section 162(m) under the Tax Cuts and Jobs Act of 2017 (TCJA) affect the deductibility (or lack…
Public companies may need to amend nonqualified and incentive compensation plans by Dec. 31, 2020
By Greg Daugherty & Dave Tumen
Public company nonqualified plans and incentive plans may need to be amended to avoid a potential violation of Internal Revenue Code (IRC) Section 409A as a result of changes to IRC Section 162(m) under the Tax Cuts and Jobs Act.…
New IRS guidance reminds employers about new long-term part-time employee eligibility rules for 401(k) plans
Much of the employee benefits news this year has related to the Coronavirus Aid, Relief, and Economic Security (CARES) Act, particularly with respect to the greater flexibility it provided 401(k) plan participants with respect to requesting in-service distributions and loans.…
Process matters: IRS issues guidance on recognition of income and FICA taxes for stock-settled awards
By Greg Daugherty & Dave Tumen
On May 22, 2020, the IRS released an Office of Chief Counsel Memorandum that addresses (i) the date that fair market value is determined and when gross income and federal income tax withholding liability arises for stock-settled awards and (ii)…