The Treasury Department and IRS today released for publication in the Federal Register a notice of proposed rulemaking (REG-123854-12) concerning application of section 409A to nonqualified deferred compensation plans.
With today’s proposed regulations [PDF 271 KB], Treasury and the IRS announced the partial withdrawal of earlier proposed regulations (referred to as the “income inclusion proposed regulations”) regarding the calculation of amounts includible in income under section 409A(a)(1) and the replacement of that provision with today’s proposed regulations.
Taxpayers may rely on today’s proposed regulations immediately. They will be published in the Federal Register on June 22, 2016. Comments and requests for a public hearing are due by a date that is 90 days after June 22, 2016.
According to the preamble the IRS and Treasury Department have concluded that certain clarifications and modifications to final regulations (April 2007) and the proposed income inclusion regulations (December 2008) will help taxpayers comply with the requirements of section 409A.
Today’s proposed regulations address certain specific provisions of the final regulations and the proposed income inclusion regulations. The preamble states that today’s proposed regulations are not intended to propose a general revision of, or broad changes to, the final regulations or the proposed income inclusion regulations. Rather, taxpayers need to take the “narrow and specific purpose” of these proposed regulations into account if submitting comments on these proposed regulations.
Today’s proposed regulations:
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