Benefits Notes |

Employee benefits are an important part of every employees' total compensation package. The continuously evolving landscape in the areas of health care reform, retirement plan design, and executive compensation makes it difficult for employee benefits professionals to keep up with relevant developments. The employee benefits attorneys at Stinson Leonard Street provide human resources professionals, plan fiduciaries, actuaries, accountants, and others in the industry with practical and cost-effective assistance as they navigate through the complex laws, regulations and guidance that govern employee benefits plans. This blog highlights key developments in the employee benefits field and items of interest to our clients. Our Bloggers →

Latest Compensation Questions Posts

IRS Approves Student Loan Repayment “Match” Under 401(k) Plan

By Mark Wilkins | December 28, 2018

Compensation Questions One of the clear trends in employee benefits involves companies offering assistance with their workforce's student loan repayments. The reasons are obvious. Student loan debt is now the largest source of consumer debt after housing and that will likely be the case for the foreseeable future. This financial insecurity...


All Businesses, even if not Subject to 162(m), Should Consider Gathering Data to Support Future Deduction of Deferred Compensation under the Grandfather Rule

By Audrey Fenske | August 28, 2018

Compensation Questions, Deferred Compensation and 409A, Executive Compensation As mentioned in a previous blog, the IRS has issued its initial guidance on Code Section 162(m), as modified by the Tax Cuts and Jobs Act.  One important aspect of the guidance is its discussion of preserving deductibility under the transition rule, also known as the 162(m) "grandfather" rule. Under the grandfather...


IRS Guidance Provides Some Clarity, but Leaves Questions Unanswered under 162(m)

By Audrey Fenske | August 22, 2018

Compensation Questions, Deferred Compensation and 409A, Executive Compensation On August 21, 2018, the IRS issued its initial guidance on the amendments to Section 162(m) made by the Tax Cuts and Jobs Act, in the form of Notice 2018-68.  The guidance is fairly limited and does not completely address some of the questions it takes on. Notably, the guidance on what compensation will not be...


IRS Wins One at Supreme Court: Severance Pay is Subject to FICA Tax

By Angela Bohmann | April 1, 2014

Compensation Questions, Payroll I blogged about the Quality Stores decision which at the district court and court of appeals levels held that certain severance payments were not subject to FICA (Social Security) taxes. The IRS had challenged the employer in that case and had lost in both lower courts. At the Supreme Court level, the IRS won. The...


When is a LLC Profits Interest not a Profits Interest? U.S. Tax Court: “When it is a Capital Interest”*

By Jeffrey Cairns | February 6, 2014

Compensation Questions, Deferred Compensation and 409A, ERISA and Other Benefits Litigation, Executive Compensation, Uncategorized On December 2, 2013, the United States Tax Court issued its opinion in Crescent Holdings, LLC et al vs. Commissioner, 141 T.C. No. 15 (12/2/13) wherein it examined the tax rules applicable to transfers of partnership interests as compensation. Crescent Holdings, LLC (“Holdings”) was a limited liability company...


Too Much Discretion With Respect to Annual Bonuses May Cause Deferral of the Employer’s Deduction

By Jeffrey Cairns | December 3, 2013

Compensation Questions, Deferred Compensation and 409A, Executive Compensation In an IRS Field Attorney Advice Memorandum (FAA 20134301F) dated September 18, 2013, the IRS Office of Chief Counsel reviewed several common bonus plan designs in connection with a request for an opinion with regard to the timing of the employer’s tax deduction with respect to the accrual and payment of bonuses....


The Supreme Court Will Decide Whether FICA Taxes is Owed on Severance Pay

By Angela Bohmann | October 10, 2013

Compensation Questions, Payroll I blogged here and here about Quality Stores, a case in which the Sixth Circuit Court of Appeals held that severance pay is not subject to FICA (Social Security) taxes if certain requirements are met: The severance payments must be made pursuant to a plan, on account of an involuntary termination, and the result of a...


No More Pre-Tax Premiums for Individual Insurance Policies?

Cafeteria Plans, Compensation Questions, Health Care Reform, Health Plan, Payroll, Welfare Plans Over the years we have seen some employers, particularly small employers, choose to provide health coverage to their employees by paying all or part of the premium for individual insurance policies that the employees have obtained. Under an old IRS revenue ruling, Rev. Rul. 61-146, that type of premium subsidy could...


Next Stop: IRS Compliance Checks of Non-Governmental 457(b) Deferred Compensation Plans

By Jeffrey Cairns and Angela Bohmann | June 26, 2013

Compensation Questions, Deferred Compensation and 409A, Executive Compensation, Retirement Plans Recently the Employee Plans Compliance Unit (EPCU) of the Internal Revenue Service completed an informal compliance check of 401(k) plans conducted via an extensive written questionnaire sent to plan sponsors. The results of the compliance checks are being used to refine the focus of plan examination efforts. This...


New Minnesota Law Expands the Use of Sick Leave

By Angela Bohmann | June 21, 2013

Compensation Questions, Payroll My colleagues on the employment side of our practice have written an Alert summarizing labor and employment laws enacted in the 2013 Minnesota legislative session. The first new law discussed in the Alert is an amendment to Minnesota statutes expanding the allowable uses of employee sick leave to cover illnesses and...