BenefitsLink note: DOL initially released this Regulatory Agenda in error on Aug. 15, 2025. See BenefitsLink summary of final Agenda publicly released on Sep. 4, 2025. MORE >>
"From early-stage biotech startups to publicly traded life sciences firms, companies ... use equity-based compensation (e.g., stock options, restricted stock units (RSUs)) and nonqualified deferred compensation (NQDC) to attract and retain top scientific and executive talent. However, without careful legal structuring and administration, these arrangements can easily run afoul of Section 409A of the Internal Revenue Code (IRC), triggering steep tax penalties and administrative exposure." MORE >>
"As employers increasingly focus on in-person office mandates, reimbursements for relocation expenses have once again become a key component of attracting top talent. If not carefully structured, however, such expense reimbursements may inadvertently trigger significant adverse tax consequences under Section 409A of the Internal Revenue Code." MORE >>
"[1] What does Section 409A regulate? ... [2] Which arrangements are exempt? ... [3] What distribution events are allowed? ... [4] What penalties apply for noncompliance? ... [5] What are the most common Section 409A mistakes? ... [6] How can I ensure Section 409A compliance? ... [T]he Dual Risk in 409A Noncompliance.... [1] Tax penalties under Section 409A ... [2] Breach of contract or fiduciary duty claims." MORE >>
"if severance is exempt from Section 409A, then: [1] The severance payments can be accelerated without penalty.... [2] The severance package may be able to be replaced with a new arrangement with different payment terms without a Section 409A 'substitution' risk ... [3] The six-month delay that applies to specified employees at public companies does not apply to exempt severance." MORE >>
"Assuming both the plan documents and exchange permit the grant of discounted options, any discounted option would need to be structured to either comply with Section 409A or meet a Section 409A exception summarized [in this article]." MORE >>
"Independent contractors are ... generally exempt from Internal Revenue Code Section 409A. This distinction positions employers to offer independent contractors a nonqualified deferred compensation (NQDC) arrangement that would not constitute a top hat plan and not be subject to any ERISA requirements because the contractor is not an employee of the company." MORE >>
"Unlike a valuation for a sale or potential investment, 409A valuations focus on the current fair market value (FMV) of a company's equity.... A 409A valuation determines a private company's FMV which is then used to set the strike price for employee stock options or the baseline value of synthetic equity awards." MORE >>
Safe Harbor Rules Relating to Required Distributions, Missing Participants, and Uncashed Checks [1545-BR34]
Enhancing Coverage of Preventive Services under the Affordable Care Act [1545-BR35]
Cost Sharing Under the Affordable Care Act [1545-BR38]
Moved from Proposed Rule stage to Final Rule stage:
SECURE 2.0 Updates to Required Minimum Distribution Rules [1545-BQ66]
Added to Final Rule stage:
Guidance on the Timing of the Use or Allocation of Forfeitures in Qualified Retirement Plans [1545-BO98]
Application of the Employer Shared Responsibility & Certain Nondiscrimination Rules to HRAs and Other Account-Based Group Health Plans Integrated With Individual Health Insurance Coverage or Medicare [1545-BP17]
"Tax-exempt employers that sponsor Code Section 457(f) plans ... may have to make changes to such plans.... If the FTC ban takes effect and causes loss of a substantial risk of forfeiture based on a noncompete, it could affect income recognition timing in the absence of an 83(b) election ... Severance plans, including those set forth in executive severance/employment agreements and those structured as ERISA plans, may have included noncompetes as a condition to receive benefits.... Employers that do not carefully monitor when a separation from service occurs may risk inadvertent violations of Code Section 409A."
"Although most executives and employers will never be involved in situations with these dollar figures, the issues under Sections 409A and 457(f) of the Internal Revenue Code implicated by these scenarios are also implicated in many common executive compensation arrangements. The arrangements provide an interesting window for employers and executives to refresh their knowledge of common issues that can arise in their own executive compensation arrangements."
"A general legal advice memorandum (GLAM) published by the IRS in December 2022, AM 2022-007, threatens to expand application of section 409A to deferred compensation payments for businesses engaged in commerce that provides services to a wide array of unrelated clients or customers. Before the GLAM, those businesses were believed to be exempt from section 409A."
11 pages. "This practice note discusses the concept of substantial risk of forfeiture (SRF) under sections 83, 409A, 457(f),457A,3121(v)(2), and 4960 of the Internal Revenue Code and the different consequences of the failure to achieve a SRF under each such section. SRF is the standard that the [Code] and Treasury Regulations apply to determine when an employee's or an independent contractor's deferred compensation vests, and therefore may be includable in income for the individual (or deductible for the employer or other controlled group member granting the compensation)."
"[1] Last chance to correct certain Section 409A document failures discovered in 2023 ... [2] Nonqualified deferred compensation deferral elections should be made on or before December 31, 2023 ... [3] Take certain action to address impact of Tax Cuts and Jobs Act on Section 162(m) of the Code ... [4] Review whether equity-based compensation plans have sufficient shares remaining for 2024 awards ... [5] Review director pay practices and consider separate annual limits on director equity awards ... [6] Section 6039 of the code information statements due by January 31, 2024 ... [7] Consider clawback disclosure issues ... [8] Consider 10b5-1 disclosure issues."
[1545-BQ28] Short-Term, Limited-Duration Insurance; Independent, Non coordinated Excepted Benefits Coverage; Level-Funded Plan Arrangements; and Tax Treatment of Certain Accident and Health Insurance
[1545-BQ29] Mental Health Parity and Addiction Equity Act and the Consolidated Appropriations Act, 2021
[1545-BQ57] Requirements in Connection With Coverage of Certain Preventive Services
Added to Final Rule stage:
[1545-BQ94] Federal Independent Dispute Resolution Fees
"At first glance, an executive's nonqualified plan benefit may seem like a tempting source of funds to satisfy his or her clawback obligation.... [C]ompanies should proceed with caution before attempting to satisfy a clawback obligation by deducting the amount from an executive's nonqualified plan benefit (or any other amount subject to Code section 409A). However, there are situations where such a clawback is permissible."
"Frequently during the financial crisis, the COVID pandemic, and now in a rising interest rate environment, we see startup and early-stage growth companies that, in the effort to conserve cash, reduce or eliminate the pay of the founders and senior executives for some period of time. While this step is logical and critical to the company achieving long-term success, it is fraught with potential adverse consequences under Internal Revenue Code section 409A."
"[T]he difficulty with 409A is its overly broad definition of what constitutes a nonqualified deferred compensation plan.... The article provides a summary of the more common 409A issues that arise when drafting and negotiating executive compensation contracts and employment agreements."
"This article summarizes the valuation requirements under the 409A Treasury regulations as they relate to pricing private company employee stock options. The general valuation parameters provided in the 409A Regulations are summarized ... as well as three specific valuation methods that, if utilized, create a presumption of reasonableness. General guidance is also provided for companies at various stages concerning the appropriate course of action when establishing the fair market value of their common stock for purposes of pricing stock options."
"[1] Last chance to correct certain Section 409A document failures discovered in 2022 ... [2] Nonqualified deferred compensation deferral elections should be made on or before December 31, 2022 ... [3] Take certain action to address impact of Tax Cuts and Jobs Act on Section 162(m) of the Code ... [4] Review whether your equity-based compensation plan has sufficient shares remaining for 2023 awards ... [5] Code Section 6039 information statements due by January 31, 2023 ... [6] Consider clawback issues ... [7] Pay for performance disclosures."
"[The Colorado [DOL] and Employment (CDLE)] interprets the Colorado Wage Act as prohibiting an employer from requiring the employee be employed on a certain date in order to receive a bonus, if all other conditions to receive the bonus have been met.... Since [retention] bonuses are typically designed to be exempt from 409A tax rules under the 'short term deferral' exception which requires there to be a 'substantial risk of forfeiture,' this could mean that there is no longer a substantial risk of forfeiture." MORE >>
