Section 409A was added to the Code last October when President Bush signed into law the American Jobs Creation Act of 2004 (Pub. L. No. 108-357). The provisions essentially impose “tax qualification” rules on nonqualified plans. They affect virtually every nonqualified plan in existence, including supplements to qualified plans and stock based compensation arrangements.
We highlight below the new guidance under the following main headings:
Key Transition Issues
Scope of Section 409A
Deferral Election Rules