While the benefit of equity compensation packages is easy to understand, the same cannot be said of the tax implications, and this article provides a broad overview of them.
Advertisement
Topics
Employee Benefits
SECURE 2.0 developments and guidance for 2024
The 2022 act affected a wide array of retirement fund and pension plan provisions, with many changes taking effect as of this year. This article highlights many of the most noteworthy ones, along with relevant IRS guidance and congressional plans for technical corrections as of this writing.
Refusal to grant 60-day IRA rollover waiver upheld
IRS refuses to grant waiver of 60-day IRA rollover requirement.
Missed Sec. 83(b) elections: Partnership and LLC special issues
This discussion focuses on grants of profits interests in a partnership or LLC and the relevance of Sec. 83(b) elections.
IRS targets Malta pension plans: Compliance options
This article describes the plans and their purported U.S. tax benefits, the potential income tax and reporting penalties for engaging in them, and ways that participants in these transactions may come back into tax and reporting compliance and mitigate penalties related to their use.
Executive compensation and changes to Sec. 162(m)
This article discusses Sec. 162(m)’s interaction with FASB ASC Topic 718, with examples illustrating their combined influence on book income tax expense and companies’ effective tax rates.
Inflation adjustments to retirement account limits issued for 2024
The IRS announced the inflation adjusted limits on benefits and contributions for various retirement accounts on Wednesday, including the maximum contribution amounts for 401(k) plans and IRAs.
Employee wellness plans: Some benefits may be taxable
The IRS’s Chief Counsel Advice 202323006 clarified that wellness benefit payments paid to employees from a fixed-indemnity wellness plan structured as a Sec. 125 cafeteria plan are gross income and taxable wages to the employees when payment is made.
IRS provides transition relief for change in beginning date for RMDs
A notice provides transition relief for the change in the required beginning date for required minimum distributions (RMDs) under the SECURE 2.0 Act and guidance related to certain specified RMDs.
Prop. regs. clarify tax treatment of certain health insurance payments
New proposed regulations clarify that accident or health insurance payments are not excludable from an employee’s income where the payments are made without regard to amount of medical expenses incurred by the employee under Sec. 213(d) and the premiums or contributions for coverage are paid on a pre-tax basis.
COVID-19 coverage without a deductible ends next year
A high-deductible health plan will no longer be permitted to provide coverage without a deductible for testing for and treatment of COVID-19 after Dec. 31, 2024.
Taxation of employees’ use of corporate apartments
The use of a corporate apartment as part of business travel generally could be excluded as a working condition fringe benefit, provided substantiation and other requirements are met.
Not all employee parking lots are created equal
An employer will have to make some effort to document that the parking available at an employee parking facility has no value, many employers will find that this burden is worth bearing because it allows deducting the full expenses of operating and maintaining the facility.
HSA amounts continue trend, increase again in 2024
The 2024 amounts from the IRS mark at least the ninth annual increase in a row for maximum contributions.
The new PLESA under SECURE 2.0
Pension-linked emergency savings accounts are intended to allow low- and-middle-income employees to accumulate by payroll deduction easy-to-access funds that they can use in an emergency.
IRS clarifies required minimum distribution reporting
New guidance on required minimum distributions reporting provides relief for financial institutions that due to a change to the RMD start date rules made by the SECURE 2.0 Act, may have incorrectly provided RMD statements to IRA owners who turn 72 in 2023.
Early access to wages may require new employment tax analyses
This item briefly summarizes how early-access options generally operate, how employment tax laws might apply, and Treasury’s proposal to address ambiguity concerning the tax impact of these types of programs.
Establishing a SIMPLE IRA plan for a company with only a few employees
A SIMPLE IRA may be ideal for smaller companies desiring to provide their employees a retirement plan.
2022 Arthur J. Dixon Memorial Award
G. Edgar “Eddie” Adkins Jr., CPA, received the 2022 Arthur J. Dixon Memorial Award, the highest honor bestowed by the accounting profession in the area of taxation.
Automatic extension provided for furnishing health coverage statements
Final regulations provide an automatic extension of time for providers of minimum essential coverage to furnish statements to individuals regarding their coverage.
employee benefits & pensions
Profits interests: The most tax-efficient equity grant to employees
By granting them a profits interest, entities taxed as partnerships can reward employees with equity. Mistakes, however, could cause challenges from taxing authorities.
