Treasury And IRS Extend Deadline For Written Compliance With Section 409A

The Treasury Department and Internal Revenue Service have extended the deadline for complying with Internal Revenue Code Section 409A to the end of 2007. As you may recall from our prior client alerts, Section 409A imposes strict new rules related to deferred compensation plans. Section 409A was enacted as part of the American Jobs Creation Act of 2004 and became effective January 1, 2005. Over the past two years, Treasury and the IRS issued interim guidance on how to comply with Section 409A and extended the deadline for amending plan documents to comply with Section 409A to December 31, 2006. In new guidance issued yesterday (IRS Notice 2006-79), Treasury and the IRS have further extended the deadline for amending plans to comply with Section 409A until December 31, 2007 and have promised to issue final regulations on Section 409A in the next few months.