Insights & Publications
Diversity & Inclusion
© 2021 Debevoise & Plimpton LLP
IRS Confirms Restricted Use of 162(m) IPO Transition Rule
7 April 2015
View Client Update
The Internal Revenue Service has adopted final rules amending its regulations under Section 162(m) of the Internal Revenue Code to clarify how certain exemptions from the $1 million deduction limitation for public companies apply to equity-based compensation.
To be eligible for beneficial tax treatment under post-IPO transition relief, RSUs and performance share units that do not otherwise qualify for the performance-based compensation exemption must be paid, and not merely granted, during the transition period.
For Options and SARs to qualify for the performance-based compensation exemption, the plan granting such compensation must specify a per-employee maximum number of shares that can potentially be granted during a specified period, either pursuant to stock options and appreciation rights, or all equity-based awards.
Employee Benefits & Executive Compensation
Elizabeth Pagel Serebransky
Jonathan F. Lewis
Meir D. Katz
UK Modern Slavery Act Transparency Statement
Debevoise Login (2)
Debevoise Women's Review