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ARTICLE · 03 FEBRUARY 2021

Tax-Exempt Executive Compensation Excise Tax Regulations (Section 4960) Finalized

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On January 19, 2021 the Department of the Treasury ("Treasury") and the Internal Revenue Service ("IRS") published in the Federal Register Final Regulations (the "Final Regulations") ...

United StatesTax
Seth Safra
Seth Safra
Amanda Nussbaum
Amanda Nussbaum
James R. Huffman
James R. Huffman
Katrine Magas
Katrine Magas
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On January 19, 2021 the Department of the Treasury ("Treasury") and the Internal Revenue Service ("IRS") published in the Federal Register Final Regulations (the "Final Regulations") interpreting the excise tax under Section 4960 of the Internal Revenue Code on certain executive compensation paid by tax-exempt organizations. The Final Regulations maintain most of the concepts from the interim guidance (Notice 2019-09 (the "Notice"), discussed here and here, and Proposed Regulations (the "Proposed Regulations"), discussed here), with a few changes.

The Final Regulations became effective January 19, 2021, but they will apply only for tax years that start after December 31, 2021. Until then:

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