"[1] Phantom stock is often the cleanest solution for private companies.... [2] SARs are similar to phantom stock but more focused.... [3] Performance-based compensation tied to measurable metrics can dramatically shift behavior in privately held businesses.... [4] Long-term incentive plans (LTIPs): Encourage strategic thinking ... [5] Profit-sharing ... A percentage of profits goes into a pool. Key employees receive allocations based on role, performance, or structure.... [6] Deferred compensation for senior leaders." MORE >>
"Following a checklist is a great way to make sure you get the most out of your restricted stock units (RSUs), manage them effectively, and avoid common mistakes. If you work at a publicly traded company, you can utilize [this] list that includes best practices commonly discussed with clients[.]" MORE >>
"[T]he Fourth Circuit affirmed a district court's order granting summary judgment to Merrill Lynch, holding that the company's WealthChoice Award program -- a contingent cash incentive requiring eight years of continuous employment to vest -- is an excepted bonus payment plan under 29 C.F.R. § 2510.3-2(c) and does not qualify as an ERISA-covered employee pension benefit plan." [Milligan v. Merrill Lynch, No. 25-1385 (4th Cir. Apr. 17, 2026)] MORE >>
"For the high-earning executive, the primary draw of an NQDC plan is the removal of the ceiling. There are generally no IRS limits on the amount of compensation that can be deferred into these plans, allowing individuals to set aside significantly more than the 401(k) maximum. This is particularly valuable for executives who want to manage their 'economic life' more holistically, planning for future income on their own terms." MORE >>
12 pages. "The external executive compensation landscape is shifting less through new [SEC] rulemaking and more through evolving expectations around disclosure quality, proxy advisor methodologies and investor scrutiny. Set out [in this article] are nine key issues and reminders to help compensation committees, in-house legal teams and human resources leaders plan for 2026 program design and executive compensation proxy disclosure." MORE >>
"It appears this lawsuit could have been avoided if the plan was drafted to specify that a surviving spouse had to be married to the participant when benefits commenced to be eligible for survivor benefits. Even if the lawsuit could not have been avoided, the employer's motion to dismiss may have been granted to end the lawsuit prior to discovery if the plan document was unambiguously drafted and the employer did not informally communicate to the participant and beneficiary that a survivor benefit was available." [Gervait v. The Coca-Cola Company, No. 25-2738 (N.D. Ga. Mar. 5, 2026)] MORE >>
"[This alert] summarizes what you must know for your tax return in 2026 if you deferred compensation into and/or received distributions from an NQDC plan in 2025.... Changes in reporting on IRS Form 1040.... W-2 reporting still potentially unclear.... What to do if your company's NQDC plan violates section 409aA.... Mistakes to avoid with filing extensions.... Equity compensation too?" MORE >>
"This article provides a practical framework for distressed companies navigating top-hat plans, covering: [1] What top-hat plans are and why they are uniquely vulnerable in distressed companies. [2] Key bankruptcy risks: preferences, fraudulent transfers, and avoidance actions. [3] Pre-filing preparation strategies that work and pitfalls to avoid. [4] Section 409A compliance essentials for distressed companies. [5] Post-petition retention tools: Key Employee Incentive Plans (KEIPs) vs. Key Employee Retention Plans (KERPs)." MORE >>
"A loan regime split-dollar life insurance arrangement can be an important option to provide retirement benefits to nonprofit executives ... Nonprofit organizations face unique challenges when designing competitive compensation packages for executives.... These rules create significant and immediate tax burdens on both the executive and the organization for retirement benefits that are intended to be paid out over multiple years." MORE >>
"[1] Always report stock sales on Form 8949 and Schedule D, even if you sold all the shares immediately after acquiring them.... [2] [T]he cost basis reported by your broker on Form 1099-B is likely to be too low, requiring an adjustment on Form 8949. [3] Watch for the common error of double-reporting stock comp income on Form W-2.... [4] After an exercise/hold of ISOs, always calculate your alternative minimum tax (AMT). [5] If you owe the AMT, remember to use any AMT credit you may have." MORE >>
"In a recent dispute over a retirement plan beneficiary, the family members of a deceased employee were unable to remove his ex-spouse as the primary beneficiary of his account because he'd faxed the request to have his ex-spouse removed from his accounts to his employer's benefits center instead of following the required procedures to update his beneficiary designation.... It's an outcome that demonstrates how easily beneficiary designations can derail an otherwise thoughtful estate plan, especially for executives with significant assets in employer-sponsored plans." MORE >>
"Seven in ten eligible executives maintain an NQDC account balance, the highest level recorded by PSCA.... Nearly 86% of employers cite maintaining a competitive benefits package as a top reason for offering an NQDC plan.... Participants deferred an average of 10% of base salary and 23% of bonus pay in 2025.... Nearly 80% of employers contribute to NQDC plans, with almost half offering a 'restoration match' to replace benefits lost due to qualified plan limits." MORE >>
"Retirement and financial wellness are core to total rewards strategies: Nearly all employers (98%) offer a qualified retirement plan; 56% match between 3-4.9%, and nearly 30% match over 5%.... 77% of organizations already have or are planning to implement financial wellness plans.... Nonqualified deferred compensation (NQDC) plans remain vital for executives: 88% of eligible participants are CEOs, 70% VPs, and 38% directors. Rising health plan costs are shifting approaches: One-third of employers saw 4-8% increases, with another third reporting higher costs. Cost-sharing is shifting to employees, and Health Savings Accounts (HSA) continue to rise." MORE >>
"What is 409A's scope of coverage? ... How can an employer avoid being subject to 409A? ... When may deferred compensation payments be made? ... Which equity arrangements are subject to Section 409A? ... Are tax exempt entities' deferred compensation plans also subject to Section 409A?" MORE >>
"The types of entities eligible for the program [have] been expanded to include multiple employer welfare arrangements (MEWAs) and Entities Claiming Exception (ECEs) seeking to file a late Form M-1.... DOL is also updating the process for the assessment of the flat rate penalty for top hat and apprenticeship and training plans." MORE >>
"Following a review of the DFVC Program, as modified in 2002 and 2013, the Department has determined to expand the penalty relief to plan MEWAs, non-plan MEWAs, and ECEs who are required to file the Form M-1.... The Department, to encourage voluntary compliance with ERISA's reporting requirements, is extending to plan and non-plan MEWAs and ECEs that are required to file Form M-1 the same $750 maximum penalty amount currently available to small plans filing a late Form 5500, and to filers of apprenticeship and training plans and top hat plans. In addition, top hat and apprenticeship plans will no longer be directed to the DFVC payment calculator. All plans eligible to pay a flat $750 fee will follow a link to a gov.pay site.... The DFVC Program described herein shall be effective December 19, 2025." MORE >>
"[1] Last chance to correct certain Section 409A document failures discovered in 2025.... [2] Nonqualified deferred compensation deferral elections should be made on or before December 31, 2025.... [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 2026 awards.... [5] Review director pay practices and consider separate annual limits on director equity awards.... [6] Review ISS 2026 benchmark policy voting policies for executive compensation matters:.... [7] Section 6039 of the Code information statements due by February 2, 2026.... [8] Continue to consider clawback disclosure issues.... [9] Consider electronic filings for future Section 83(b) elections." MORE >>
"Key aspects of the DOL's reasoning [in Advisory Opinion 2025-03A] include: [1] the purpose of the program ... [2] the design and administration of the program, [3] the unfunded, unsecured and nonguaranteed nature of the awards, [4] the lack of accruals under the program and [5] the fact that participants are annually notified that the express purposes and conditions of the program are that of an incentive program and not a retirement plan subject to ERISA." MORE >>
"IRS just released the 2026 contribution limits for qualified retirement plans. Knowing those limits, which are adjusted annually for inflation, is crucial to decision-making about nonqualified deferrals for the many employees and executives who are eligible to participate in company NQDC plans.... You may have an extra incentive to defer taxable income if you believe you will be in a higher income-tax bracket in 2026 than you are in 2025 ... While the income-tax rates for most taxpayers with MAGI of over $500,000 are 35% and 37% (the top two brackets), the SALT deduction phaseout can push your actual marginal tax rate to almost 46%." MORE >>
"Newly important for planning at year-end 2025 is the impact of the 'One Big Beautiful Bill' Act (OBBBA) ... [which] significantly raised the cap on the state and local tax (SALT) deduction but also phases out the deduction for yearly adjusted gross income (AGI) exceeding $500,000. An income deferral into an NQDC plan could reduce your phaseout in whole or in part." MORE >>
"When you are evaluating whether to exercise stock options or sell shares from vested restricted stock/RSUs or an ESPP, you want to consider the thresholds that may trigger higher tax rates for you either this year or next. Assess whether you should defer income into next year or accelerate income into this year. Project your income from equity awards to see whether it will trigger the additional Medicare taxes on high incomes this year or next year." MORE >>
"The complaint states that the Opinion used a purpose test and determined that the plan's purposes were to provide bonuses and not retirement income, when case law requires an examination of whether the plan has the effect of deferring income to termination of employment or beyond.... [It] is not unforeseeable that the court that previously held that the Morgan Stanley plan is subject to ERISA will invalidate the Opinion holding it is not." [Sheresky v. Chaves-DeRemer, No. 25-8935 (S.D.N.Y. complaint filed Oct. 28, 2025)] MORE >>
"No MLB team has used deferred compensation contracts more than the Dodgers, with the next closest team being over $800 million behind. In recent years, the Dodgers have garnered the most headlines for this type of compensation structure. But nothing the Dodgers are doing is improper or unusual -- in fact, it is regularly used in the corporate employment world. And it has a history in the MLB." MORE >>
"While the numbers are eye-popping compared to normal employment agreements, professional athletes' contractual negotiations with their employer, the MLB team, must abide by the same regulations, risks, and benefits as any employment contract. This article addresses how the recent MLB deferred compensation contracts fit into the larger legal landscape of employment contracts and associated risks and benefits to players and teams." MORE >>
"[P]lan administrators must determine whether a detained worker remains covered under certain company benefit plans -- and when such coverage ceases. [1] 401(k) Plans: Will employee contributions stop? ... Will detention impact vesting service? ... Will detention trigger a distribution event? ... [2] Will detention trigger a loss of health plan coverage? ... [3] Deferred compensation plan ... [4] Action item checklist." MORE >>
