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Join Morgan Lewis in May 2018 for these programs on a variety of topics in employee benefits and executive compensation, including investment related matters.
The Tax Cuts and Jobs Act of 2017 (Act) introduced numerous significant changes to Section 162(m) of the Internal Revenue Code (IRC).
The recent US tax reform law adopts Internal Revenue Code Section 83(i), which will allow certain private company employees to defer federal income tax on eligible stock options and restricted stock units for up to five years following their respective exercise or settlement. To learn more about Section 83(i), including how it could be useful for bridging the gap between when an employee is subject to income tax and when the employee’s shares can be liquidated, please read our recent LawFlash.
Internal Revenue Code Section 162(m) imposes a $1 million limit on the amount most public companies can deduct for compensation paid to any “covered employee.” The Tax Cuts and Jobs Act (the Act) significantly changes Section 162(m) by eliminating the exception for “qualified performance-based compensation,” expanding the “covered employee” group and expanding the definition of “publicly held corporation.”
The tax bill formerly known as the Tax Cuts and Jobs Act (the Act) reduces tax rates for individuals, lowering the top marginal tax rate from 39.6% to 37%, effective January 1, 2018. Employers should make sure that the tax rates used for federal tax withholding on equity awards are reduced to correspond to the lower rates under the Act, in order to avoid adverse financial accounting consequences.
The Tax Cuts and Jobs Act (the Act) was passed by the House and Senate and is expected to be signed into law by President Trump soon.