2 pages. Excerpt: Public companies could effectively be prohibited from funding nonqualified plan benefits for certain executives through a rabbi trust (or otherwise) under a provision in the Pension Protection Act of 2006 (the 'PPA'). Specifically, funding for top executives may need to cease if any qualified defined benefit plan in a company's controlled group is considered 'at risk' under the PPA rules. While the IRS has yet to issue any guidance on this rule under Code section 409A(b)(3), a Treasury official recently confirmed informally that companies need to be in good faith compliance with the rule at this time. We summarize below the requirements of section 409A(b)(3).

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