IRS Guidance on Section 457A Foreign Deferred Compensation Rules

The Treasury Department and Internal Revenue Service recently released interim guidance (Notice 2009-8) interpreting Code section 457A, which generally imposes substantial restrictions on the use of nonqualified deferred compensation arrangements sponsored by certain foreign entities. In general, it appears that the Notice confirms our fears that Code section 457A will impact a broad range of employers, employees and compensation arrangements.  Attached is our summary of the major issues addressed in the Notice.