Golden Parachutes in Mergers and Acquisitions: Sections 280G and 4999, Strategies to Avoid Tax Pitfalls

BARBRI

This CLE/CPE webinar will offer advisers and counsel a review of tax implications of the application of the U.S. golden parachute rules in mergers and acquisitions. The panel will discuss circumstances on when IRC Sections 280G and 4999 will apply, disqualified individuals, payments on a change of control and thresholds, and best practices for counsel to avoid tax pitfalls in structuring and implementing a deal.

Description

In the context of mergers and acquisitions, U.S. golden parachute rules for executive compensation must be considered in the transaction. Advisers and counsel must navigate Internal Revenue Code rules and other compensation regulations and address the key issues.

Golden parachute payments are governed by Sections 280G and 4999 of the Code. If applicable, these Code Sections generally impose a 20% excise tax on disqualified individuals for receiving excess parachute payments and the denial of corporate deductions for such payments. Critical components in structuring transactions that may be subject to the golden parachute rules are determining who are disqualified persons, the nature of the compensation, change in control, shareholder approval, and other vital items.

Practitioners must fully understand these tax issues and other legal implications to avoid pitfalls in structuring and implementing the deal.

Listen as our authoritative panel of tax and executive compensation practitioners guides you through applying the golden parachute rules under IRC Sections 280G and 4999 to M&A transactions and best practices for counsel to avoid tax pitfalls in structuring a deal.

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