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2020 has brought substantial changes to the Form W-4 (Employee’s Withholding Certificate) compared with previous versions of the form. These changes were made by the IRS to comply with new income tax withholding requirements under the Tax Cuts and Jobs Act (Pub. L. 115-97). For instance, in the past, the…

The prospect of a U.S. Department of Labor (“DOL”) investigation or Internal Revenue Service (“IRS”) examination of an employee benefit plan can be daunting for any plan sponsor. Understanding the process and adopting best practices, however, can make the experience less intimidating and improve the results for all parties.

Enforcement…

This installment of the overview of the Proposed Regulations under Code Section 162(m) focuses on the definition of what is “applicable employee remuneration.” As a ‎reminder, Code Section 162(m) generally limits the compensatory deduction to the first $1 million of “applicable employee remuneration” paid by a publicly held corporation to…

Today’s installment of our overview of the Proposed Regulations under Code Section 162(m) highlights the expansion of who is a “covered employee.”  As a ‎reminder, Code Section 162(m) generally limits the compensatory deduction to the first $1 million of compensation paid by a publicly held corporation to each “covered employee.”  …

On December 16, 2019, the Treasury Department released proposed regulations (the “Proposed Regulations”) to address the amendments made to Code Section 162(m) by the Tax Cuts and Jobs Act (the “Amendment”).  As background, the Amendment eliminated the exclusion attributable to qualified performance-based compensation from the $1 million cap on the…

In 2017, the IRS significantly limited the ability of plan sponsors to request a determination letter that its individually-designed retirement plan met the tax qualification requirements of the Internal Revenue Code.  Since that date, plan sponsors could request determination letters only upon the plan’s initial qualification or termination.

The IRS…

The Internal Revenue Service recently published final regulations modifying the rules relating to hardship distributions from Sections 401(k) and 403(b) plans.  The final regulations reflect statutory changes affecting Section 401(k) and 403(b) plans, including changes made by the Bipartisan Budget Act of 2018.

The final regulations are substantially similar to…

The IRS has been issuing the 2017 Employer Shared Responsibility Penalty (ESRP) assessments (Letter 226-J).  The Letter 226-J provides the IRS’ determination of whether an “applicable large employer” may be liable for an ESRP for a particular calendar year and shows the proposed assessment of the penalties based on the…