Under Internal Revenue Code section 83(b), taxpayers who receive property, such as stock, in exchange for services that is subject to forfeiture, or is unvested for a certain period, may elect to pay income tax on the fair market value of the property as if it were not subject to forfeiture, or fully vested, in
Court Denies Expanding Preliminary Injunction on FTC Non-Compete Rule
As reported in my previous article, Court Grants Preliminary Injunction Against FTC Ban on Non-Compete Agreements, the District Court granting the preliminary injunction from the FTC enforcing its ban on non-compete agreements limited the relief to only the plaintiff bringing the case, Ryan LLC, and not all business nationwide. I predicted that the Plaintiff
Court Grants Preliminary Injunction Against FTC Ban on Non-Compete Agreements
As I wrote in April, a lawsuit filed by Ryan, LLC in the United States District Court for the Northern District of Texas, challenged the recently adopted Federal Trade Commission’s (FTC) rule making most non-compete agreements unenforceable (Rule). See FTC’s Non-Compete Rule Affecting Executive Compensation Challenged in Courts. On July 3, 2024, the court
FTC’s Non-Compete Rule Affecting Executive Compensation Challenged in Courts
On April 23, 2024 the Federal Trade Commission (FTC) issued its final rule that prohibits most non-compete clauses. The rule is effective 120 days after its publishing in the Federal Register (scheduled for May 7). However, lawsuits challenging the rule have already been filed.
Prohibition on Non-Compete Clauses.
Clauses preventing employees, especially higher-paid executives
No Fooling Employers Should Consider An NQDC Plan For Pre-Tax Make-Up Contributions
Several studies continue to show the importance of nonqualified deferred compensation (NQDC) plans to attract and retain executive level talent for employers. See Study Shows The Need For Nonqualified Plans To Attract And Retain Talent. SECURE 2.0 also contains a provision that may encourage the use of NQDC plans. It provides that after 2023
Study Shows The Need For Nonqualified Plans To Attract And Retain Talent
A new survey conducted by Newport Group and PLANSPONSOR shows a dramatic increase in the use of nonqualified deferred compensation (NQDC) plans to retain and attract executives. Of 350 organizations offering NQDC plans, 42% said that was the reason for offering them. This is up from 26% in the 2020 survey. The survey also found
COVID-19 EFFECTS ON EXECUTIVE COMPENSATION OF PRIVATE COMPANIES-PART 3: CARES Act/CESA Main Street Loan Restrictions on Compensation
This is the third and final installment of the effects of Covid-19 Pandemic (Pandemic) on executive compensation of private companies. Part 1 discussed the issues of reducing compensation of Executives. See Part 1. Part 2 discussed issues with deferred compensation plans of Executives. See Part 2. This Part 3 deals with limits on
COVID-19 EFFECTS ON EXECUTIVE COMPENSATION OF PRIVATE COMPANIES-PART 2: Deferred Compensation
Executives often participate in various nonqualified deferred compensation plans designed to reward upper management. These can be simple plan designs such as electively deferring a portion of their salary or bonus until a later year. Or the plan can be more complicated such as awards of phantom stock or stock appreciation rights that will pay
COVID-19 EFFECTS ON EXECUTIVE COMPENSATION OF PRIVATE COMPANIES-PART 1
Rank and file employees who may have lost their job or had hours reduced probably don’t care about the effects of the economic downturn resulting from the COVID-19 Pandemic (Pandemic) on executives and key management employees. However, business owners who have provided such employees with employment agreements, deferred and/or incentive compensation, and perhaps equity or
In 21st Century We May Not Have Hoverboards But We Have Electronic Top Hats
In 1989’s film Back to the Future II, Marty McFly rides a hoverboard (flying skateboard) to escape Griff Tannen and his gang of teenage thugs in the year 2015. Well