Thursday, February 21, 2008
The ruling holds that compensation paid to an executive is not qualified performance-based compensation for purposes of § 162(m), even if the compensation is paid upon the attainment of the performance goal, if the plan agreement or contract provides for payment of compensation to an executive upon the attainment of a performance goal or for (1) termination without “cause“ or for “good reason” or (2) voluntary retirement.
Although Rev. Rul. 2008-13 thus reaffrims the analysis in PLR 200804004, the new rule only applies prospectively.