Guidance Issued On Reporting And Wage Withholding Under Code § 409A

Internal Revenue Code § 409A provides, among other things, that all amounts deferred under a nonqualified deferred compensation plan for all taxable years are currently includible in gross income to the extent not subject to a substantial risk of forfeiture and not previously included in gross income, unless certain requirements are met. Under Code § 6051, amounts deferred under a nonqualified deferred compensation plan must be reported annually on Form W-2 (Wage and Income Tax Statement) or Form 1099 (Miscellaneous Income), as appropriate. In addition, Code § 6041 requires payers to report on Form W-2 or 1099 amounts includable in income under a deferred compensation plan—either by its terms or as a result of a violation of Code § 409A.