When Personal Security Is A Perk: SEC Reporting And Income Tax Implications For Corporate Security Benefits

Executive protection is no longer reserved for heads of state. As public scrutiny and threats against corporate leaders intensify, more companies are paying for residential security systems, bodyguards, private air travel, secure ground transportation, and cybersecurity for senior executives. While many companies initially assume that such protection is simply a business expense, the reality is that company-paid security packages may be treated as taxable compensation to the executive unless certain requirements for exclusion are met. But, that is not all: for public companies, such benefits are also generally required to be disclosed as a perquisite to the executive under Securities and Exchange Commission (SEC) disclosure rules.