Can a nonqualified plan allow the deferral of "guaranteed payments"?

Has anyone seen this? What election rules apply to such a deferral? What are the pros and cons of the plan allowing this?

What's your definition of "guaranteed payment"?

If you mean a gp as defined in IRC Section 707, yes, that can be done, but why would the other partners be interested in allowing this? 

Yes, guaranteed payments as defined in IRC Section 707. I do not know the "why." I only know that the client is asking to do it. Would such a deferral follow the election rules of performance-based compensation? Thank you for the responses.

Whether one could defer GPs using the 409A performance-based rules is fact-dependent.    

And the 409A regulations governing partners and partnerships remain unwritten.

22 hours ago, XTitan said:

And the 409A regulations governing partners and partnerships remain unwritten.

The preamble to 409A says that until partnership 409A regs are published, apply the employer-employee and independent contractor provisions in the regs "by analogy." But many aspects of partnerships are not really analogous.

If a partner has an arrangement with his/her partnership that will, based on services done in year X, make him or her entitled to a guaranteed payment for year X, and that partner, before the end of year X-1, enters into a binding election to defer the amount that otherwise would be a guaranteed payment in year X, and the deferral is not recognized in his/her capital account, then that should work so that the guaranteed payment would not be on the partner's K-1 for year X. However, there are collateral effects. The other partners will have phantom income in the amount of the guaranteed payment if it is simply added to their K-1's proportionately as increases to their capital accounts. So do they then get tax distributions to hold them harmless from the phantom income? Do you instead just pay it out to the other partners proportionally to their income shares? How you do it needs to be in the partnership agreement. How do you allocate the eventual deduction when the amount is paid, given that partners may come and go before the payment? How do you ensure the chargeback for partners who got the income, but leave before it is paid to the guaranteed payment partner? Very complicated accounting.