Code § 409A Nonqualified Deferred Compensation Rules Revisited
Employee Benefits and Executive Compensation Blog - ebeclaw.blogspot.com
Charles C. Shulman, Esq. cshulman@ebeclaw.com 201-357-0577
Friday, August 9, 2024
Monday, June 24, 2024
Court Stay on Enforcement of FTC Noncompete Ban and Other Noncompete Developments
CHARLES C. SHULMAN, ESQ.
cshulman@ebeclaw.com
cshulman@yahoo.com
www.ebeclaw.com (blog)
212-380-3834 / 201-357-0577
Court Stay on Enforcement of FTC Noncompete
Ban
and Other Noncompete Developments
The Federal Trade Commission on May 7, 2024 published a ban on all noncompete clauses as an unfair method of competition, effective September 4, 2024 (with the exception of grandfathered agreements in effect on Sept. 4, 2024, which can continue to be enforced for senior executives, i.e., earning over $151,164 and in a policy-making position). The Federal Northern District Court in Texas,, in Ryan LLC v. Federal Trade Commission, imposed a stay and preliminary injunction against enforcement of the FTC ban, pending a final decision. State laws in 14 states have recently banned some or all types of noncompete provisions, and the state laws are not subject to the Federal District Court stay. Also, noncompete provisions, even prior to FTC and state legislation, were subject to restrictions by case-law.
I. FTC
Noncompete Clause Ban and Court Stay on Enforcement
A. Final
FTC Rules Banning Practically All Noncompete Provisions – Effective Sept. 4,
2024 – On May 7, 2024, the Federal Trade Commission (FTC) published
a new rule in final form, banning all noncompete clauses as an unfair method of
competition, and therefore violating Section 5 of the FTC Act.[1]
Prior to the stay on enforcement of the
FTC ban from the district court in Texas, the effective date of the new
noncompete ban was to be 120 days after publication, i.e., September 4, 2024.
This
rule: (i) will prohibit employers from entering into noncompete agreements and
other clauses with all employees or service providers ("workers");
and (ii) will prohibit enforcement of existing noncompete clauses against all workers
(with the exception of grandfathered agreements in effect on Sept. 4, 2024,
which can continue to be enforced for senior executives).
These
FTC rules were designed to protect the fundamental freedom of workers to change
jobs, increase innovation, and foster new business formation.
B. Key
Points in Final FTC Rule – The following are the key provisions in the FTC
ban:
1.
Ban on Noncompete Clauses – Under the FTC rule, it is an unfair method
of competition for a person (including an employee or independent contractor):
(i) to enter into or attempt to enter into a noncompete clause; (ii) to enforce
or attempt to enforce a noncompete clause; or (iii) to represent that the
worker is subject to a noncompete clause. [2]
2.
Senior Executives Exception for Grandfathered Contracts – For senior executives, there is an
exception if the noncompete was entered into prior to the effective date of the
FTC regulations (Sept. 4, 2024). "Senior executives" mean workers who
(i) are in a policy-making position, and (ii) received annual compensation of
at least $151,164 in the preceding year (or annualized if was employed for only
part of the year; and "policy-making position" means the president,
chief executive officer or equivalent, any other officer of a business entity
who has policy-making authority, or any other natural person who has
policy-making authority for the business entity similar to an officer with
policy-making authority. [3] Thus, with respect to senior executives, any
noncompete clauses entered into prior to Sept. 4, 2024 can continue to be
enforced. [4] After the effective date, no new noncompete
provisions can be entered into.
3.
Notice Requirement – The new FTC
rule provides that employers must provide notice to workers (other than senior
executives) who are bound by an existing noncompete that they will not be
enforcing any noncompete provisions against them. [5]
The notice may be on paper delivered by
hand to the worker, or by mail at the worker's last known personal street
address, or by email at an email address belonging to the worker, including the
worker's current work email address or last known personal email address, or cell
phone text message. [6]
4.
Model language –
The FTC rules provides a model notice that employers can use for workers, which
states how prior noncompetes may not be binding. [7]
5.
Sale Exception – The Final Rule does not prohibit enforcement of noncompete
clauses that are entered into with respect to the bona fide sale of a business,
including a bona fide sale of (i) a business entity, (ii) an individual’s
interest in a business entity or (iii) all or substantially all of a business
entity’s operating assets.[8]
6.
Only for Post-Employment Bans – The FTC ban specifically applies to
post-employment noncompetes, so it does not affect restrictions on moonlighting
in the same field.
7.
Non-Solicitation Clauses – Non-solicitation clauses that do not prohibit or function to
prevent a worker from switching jobs or starting a new business are generally not restricted by the FTC
rule, as noted in the preamble to the 2024 final rule.
8.
Objective –
The FTC's final rule aims to enhance worker mobility, encourage
entrepreneurship, and spur innovation by banning noncompete provisions and
promoting a more dynamic economy.
C. Stay and
Preliminary Injunction on Enforcement of FTC Ban
1. Stay and
Preliminary Injunction by Federal Northern District in Texas – Within a day
or two of when the FTC announced the final rule banning noncompete clauses, two
lawsuits were filed in Texas to challenge the rule, (i) Ryan, LLC v. FTC [9] on Apr. 23,
2024 in the Northern District in Texas, and (ii) U.S. Chamber of Commerce v.
FTC [10] the following
day in the Eastern District in Texas. The Eastern District Court of Texas dismissed
the Chamber of Commerce case because, under the first to file rule, the Ryan
LLC case was filed first.[11]
The Texas Northern District judge (Asa Brown), in Ryan LLC v. Federal Trade
Commission, 2024 WL 3297524, --- F.Supp.3d --- (N.D. Tex. July 3, 2024), halted
the FTC’s ban on non-compete agreements set to take effect in September 4, and issued
a stay and a preliminary injunction against implementation of the FTC ban,
originally set to take effect on September 4. The judge stated that she intends
to issue a final decision on the merits by August 30, 2024. The judge noted
that the FTC exceeded its statutory authority in promulgating the noncompete
ban, and that the role of an administrative agency is to do as told by
Congress, not to do what the agency thinks it should do.
2. Disagreement
by Federal District Court in Pennsylvania – In ATS Tree Services, LLC v.
FTC, a similar suit was filed on Apr. 25, 2024 in the Eastern District in
Pennsylvania. [12]
ATS Tree Services filed a motion for
preliminary Injunction on May 14 seeking a stay of the effective date. In
contrast to the Ryan LLC v. FTC case, discussed above, the Eastern District in
Pennsylvania, in ATS Tree Services, LLC v. Federal Trade Commission, 2024 WL
3511630 (E.D. Pa., July 23, 2024), denied ATS Tree Services motion to stay and
preliminary enjoin enforcement of the FTC ban because it did not find any irreparable
harm.
The Fifth
Circuit in Texas (where the Ryan case was filed) is more employer friendly than
the Third Circuit in Pennsylvania (were the ATS Tree Services case was filed), and
a conflict of circuits may lead to an appeal to the Supreme Court to resolve
the differences.
3. Arguments
for Challenges – Arguments made by the lawsuits include that: (i) the rules
implicates the major questions doctrine, which would necessitate additional
legal authority from Congress; (ii) the FTC rule is arbitrary and capricious
under the Administrative Procedure Act because the evidence the FTC relies on
cannot justify a nationwide ban of noncompetes in all situations; (iii) the FTC
rule incorrectly expands what is a prohibited an unfair method of competition;
and (iv) the rule unlawfully infringes on state contract laws.
4. Stay in
Effect – As noted above, since one of the Federal courts (N.D. Pa.) imposed
a stay and preliminary injunction on the FTC ban, the status of the rule is
currently in flux.
II. States
that Have Banned Noncompete Provisions (all Since 2021)
A. Four
States Ban All Noncompete Agreements – In the past three years, California,
Minnesota, North Dakota and Oklahoma have passed broad legislation banning post-employment
noncompete agreements, regardless of salary. (California has had long-standing
legislation banning most noncompete agreements, but this was expanded by 2023
legislation even to out-of-state contracts.)
B. Ten
States and D.C. Ban Noncompete Agreements for Non-Highly Paid Employees – Colorado,
Illinois, Maine, Maryland, New Hampshire, Oregon, Rhode Island, Virginia,
Washington and the District of Columbia have all passed laws in the past three
years prohibiting post-employment noncompete agreements unless the employee
earned above a certain threshold. There are also non-compete rules from a few
states prior to 2020, like Massachusetts in 2018 (and California, as noted
above). (Also, in July 2024,
Pennsylvania banned noncompete covenants for health care providers if it is for
more than one year or the health care provider was dismissed by the employer.)
C. New York
– In New York a bill that would ban almost all noncompete agreements was passed
but was vetoed by Governor Hochul because it was too broad.
III. Existing State Law
Regarding Noncompete Agreements.
A. Existing States' Case-law Would be
Applicable if Statutory Ban is Stayed – If the FTC
ban on noncompete clauses is stayed or struck down in court, or reversed or
limited in future legislation or FTC guidance, preexisting state law and state
cases would become operative. In states that have not enacted recent bans on
noncompete provisions (or where such state bans have been struck down), the
existing case law in those states will again be operative.
B. Enforceability of noncompete agreements
– State laws vary regarding enforceability of noncompete provisions. Generally,
noncompete provisions will be enforced in most states if the restrictions are
reasonable in geographical scope and
reasonable in time period, and they are necessary to protect legitimate
business interests.
For example, in New York, which is fairly liberal in allowing
noncompete restrictions, the noncompete restrictions will be enforceable if:
(i) the time period of restriction is reasonable, (ii) the geographical scope
is reasonable, (iii) the burden on the employee is not unreasonable, (iv)
public policy is not harmed, and (v) the restrictions are necessary for the
employer's protection.[13] In New
Jersey noncompete restrictions will be enforced only if reasonable under the
circumstances.[14]
Texas and Florida statutes restrict noncompete requirements unless they are
reasonable restrictions necessary to protect legitimate business interests.[15]
California by statute, even prior to the 2023 ban, would generally
void noncompete provisions, providing that "except as provided in this
Chapter, every contract by which anyone is restrained from engaging in a lawful
profession, trade or business of any kind is to that extent void." [16]
The Ninth Circuit allowed "narrow restraint" enforcement of
noncompete provisions that are very limited, but the California Supreme Court
rejected this exception.[17]
The 2023 California legislative ban would, presumably, supersede these
prior rules.
D. Blue-penciling Noncompete Agreements
– Where noncompete provisions are overbroad and therefore unenforceable on
their terms, many states will "blue pencil" the restrictive covenants
to a limited scope for which they would be enforceable. For example, in
New York restrictive covenants will be blue penciled.[18]
Often, employment agreements will add language to specifically provide for
blue penciling.
IV. Points
to Consider re FTC Final Rule
A. Review
Noncompetes – Employers should review noncompete provisions that would
violate a statutory ban and see if nonsolicitation and nondisclosure covenants
can provide the needed protection.
B. Sept. 4, 2024 Grandfather for Senior Executives and Modifications – As noted
above, for executives earning over $151,164 annually and in a policy-making
position, there is a grandfather exception from the FTC ban if the agreement
was entered into prior to Sept. 4, 2024. It may be beneficial for that reason
to separate the noncompete from other terms of the employment agreement so that
the noncompete can remain unaltered in its grandfathered form. It is not clear to what extent modifications to, or
extensions of the terms of a pre-negotiated non-compete in connection with a
separation) would result in loss of grandfathered status for senior executives.
C. Notice –
Notices tCo those with non-grandfathered noncompete agreements, do not have to
be as discussed above.
D. Garden-Leave
– These are generally not covered by the FTC rule, because the employee is
still employed for that period.
E. Cease
and Desist – The FTC cannot assess civil penalties for using unfair methods of
competition, but if an entity is ordered to cease and desist from FTC
violations, monetary penalties can sometimes be obtained in court.
F. Modifications – It is unclear whether
the negotiated non-compete in connection with a separation (even narrowing an
existing scenario) would result in loss of grandfathered status for senior
executives.
G. Court Stay
– As noted above, the Northern District in
Pennsylvania imposed a stay and preliminary injunction on enforcement of the FTC
noncompete ban.
[1] Federal Trade Commission (FTC) New Final Noncompete Clause Rule in
26 CFR § 910, announced by the FTC on April 23, 2024, and published in 89 Fed.
Reg. 38342 (May 7, 2024). The effective date is Sept. 4, 2024.
[2] 16 CFR § 910.2(a)(1).
[3] 16 CFR §
910.1
[4] 16 CFR § 910.2(a)(2).
[5] 16 CFR § 910.2(b)(1).
[6] 16 CFR § 910.2(b)(2)(b).
[7] 16 CFR § 910.2(b)(4) (figure 1).
[8] See 16 CFR § 910.3.
[9] Ryan LLC v. FTC, No. 3:24-cv-00986, (N.D. Tex. Apr. 23, 2024).
[10] Chamber
of Commerce of the U.S. v. FTC, No. 6:24-cv-00148
(E.D. Tex., Apr. 24, 2024).
[11] ATS
Tree Services, LLC v. FTC, No. 2:2024cv01743 (E.D. Pa. Apr. 25, 2024).
[12] Chamber
of Commerce of the U.S. v. Federal Trade Commission, --
F.Supp.3d --, 2024 WL 1954139 (E.D. Tex., May 3, 2024).
[13] See,
e.g., Service Systems Corp. v. Harris, 341 N.Y.S.2d 702 (4th Dep't 1973);
Mallory Factor Inc. v. Schwartz, 146 A.D.2d 465, 536 N.Y.S.2d 752 (1st Dep't
1989); International Paper Co. v. Suwyn, 951 F. Supp. 445 (S.D. N.Y. 1997).
[14] E.g.,
Community Hosp. Group, Inc. v. More, 183 N.J. 36, 869 A.2d 884 (2005).
[15] Texas
Business & Commerce Code §15.50; Florida Statutes Annotated §542.335.
[16] California
Business & Professional Code §16600.
[17] The
Ninth Circuit provided a narrow restraint exception in Campbell v. Trustees of
Leland Stanford Jr. University, 817 F.2d 499 (9th Cir. 1987) and General
Commercial Packaging v. TPS Package Engineering, Inc., 126 F. 3d 1131 (9th Cir.
1997). The California Supreme court rejected this narrow restraint exception in
Edwards v. Arthur Andersen LLP, 44 Cal.4th 937, 81 282 (Cal. S. Ct. 2008).
[18]
See,
e.g., Deborah Hope Doelker, Inc. v. Kestly, 87 A.D.2d 763, 449 N.Y.S.2d 52 (1st
Dep't 1982); Muller v. N.Y. Heart Ctr. Cardiovascular Specialists P.C., 238
A.D.2d 776, 656 N.Y.S.2d 464, 465 (3d Dep't 1997); BDO Seidman v. Hirshberg, 93
N.Y.2d 382, 690 N.Y.S.2d 854, 712 N.E.2d 1220 (1999).
Friday, November 3, 2023
2024 BENEFIT PLAN COST-OF-LIVING ADJUSTMENTS (with SECURE 2.0 changes)
11/4/2023
Charles C. Shulman, Esq.
212-380-3834 201-357-0577
cshulman@ebeclaw.com
2024 BENEFIT PLAN COST-OF-LIVING ADJUSTMENTS (with SECURE 2.0 changes)
BENEFIT PLAN COST-OF-LIVING
ADJUSTMENTS |
2023 |
2024 |
Qualified Plan Adjustments |
||
402(g) Deferral Limit – Annual limit on pre-tax
salary deferrals to 401(k), 403(b) and 457(b) plans – IRC §§ 402(g)(1), 402(g)(3) & 457(e)(15) |
$22,500 |
$23,000 |
Age 50 Additional Catch-Up Deferrals – Age
50 & older “catch-up” deferrals beyond the 402(g) limit above available for
401(k), 403(b), & governmental 457(b) plans – IRC § 414(v)(2)(B)(i). |
$7,500 |
$7,500 |
DB Benefit Limit – Limit on annual benefits from
defined benefit plans – IRC §
415(b) |
$265,000 |
$275,000 |
DC Contribution Limit – Annual contribution limit
for defined contribution plans –
IRC § 415(c) |
$66,000 |
$69,000 |
Compensation Limit – Annual compensation limit
for qualified plans and SEPs – IRC
§§ 401(a)(17), 404(l) & 408(k) |
$330,000 |
$345,000 |
Grandfathered § 401(a)(17) annual compensation limit for
governmental plans in effect on July 1, 1993 – Treas. Reg. § 1.401(a)(17)-1(d)(4)(ii) |
$490,000 |
$505,000 |
Highly Compensated Employee - Highly compensated
employee threshold for nondiscrimination testing in the following year – IRC § 414(q)(1)(B) |
$150,000 |
$155,000 |
Key Employee Officers in Top Heavy Plan – Key
employee threshold for officers in top heavy plans – IRC § 416(i)(1)(A)(i) |
$215,000 |
$220,000 |
QLAC Limit – Limit on premiums for qualified
longevity annuity contracts (QLACs) under Treas. Reg. § 1.401(a)(9)-6 Q&A 17 increased from $150,000 to
$200,000 under SECURE 2.0 § 202 for contracts purchased or received on or
after Dec. 29, 2022 |
$200,000 |
$200,000 |
ESOP Distributions – (i) minimum account
balance allowing extension of distribution period beyond 5 years; and (ii)
dollar amount (or fraction) in excess of minimum account balance allowing
extension of distribution period for additional year – IRC § 409(o)(1)(C)(ii) |
(i) $1,330,000 (ii) $265,000 |
(i) $1,380,000 (i) $275,000 |
SEP & SIMPLE Adjustments |
||
SEP Earnings Level – Minimum earnings level to
qualify for Simplified Employee Pension (SEP) IRA – IRC § 408(k) |
$750 |
$750 |
SIMPLE Salary Deferral Limit – SIMPLE 401(k) or SIMPLE
IRA elective deferral limit – IRC
§ 408(p)(2)(E) (referenced by § 401(k)(11)(B)(i)(I)) |
$15,500 |
$16,000 |
SIMPLE Catch-Up for Age 50 – SIMPLE 401(k) or SIMPLE
IRA age 50 catch-up – IRC § 414(v)(2)(B)(ii). Under
SECURE 2.0 beginning in 2024 the SIMPLE catch-up is supposed to increase by
10%. Also, under SECURE 2.0 § 109 the catch-up for SIMPLE plans for
those ages 60-63 will be increased about 50% in 2025. |
$3,500 |
$3,500 |
Traditional IRA & Roth IRA Adjustments |
||
IRA Limit – Traditional IRA and Roth IRA
contribution limit is indexed –
IRC §§ 219(b)(5)(A), 408(a)(1) & 408A(c)(2) |
$6,500 |
$7,000 |
Spousal IRA Contribution Limit – A
spousal IRA or spousal Roth IRA where both spouses contribute is double the
above. |
$13,000 |
$14,000 |
IRA Catch-up Contribution - Age 50 & older
“catch-up” for IRAs & Roth IRAs (not currently adjusted but under SECURE
2.0 § 108 will adjust beginning in 2025) – IRC § 219(b)(5) |
$1,000 |
$1,000 |
Phaseout where IRA Owner is also
Covered by an Employer Plan –
Adjusted gross income (AGI) phase-out of deductible contribution to IRA if individual
is also covered by employer-sponsored retirement plan for: (i) married filing
jointly, (ii) single or (iii) married filing separately – IRC
§ 219(g)(1)-(5) |
(i) $116,000 - $136,000, (ii) $73,000 - $83,000, (iii) 0 - $10,000 |
(i) $123,000 - $143,000,
(ii) $77,000 - $87,000, (iii) 0 - $10,000 |
Phaseout where Spouse of IRA Owner is
Covered by an Employer Plan –
AGI phase-out of deductible contribution to IRA if contributor is not covered
by an employer-sponsored plan but spouse is covered by an employer-sponsored
plan – IRC § 219(g)(7) |
$218,000 - $228,000 |
$230,000-$240,000 |
Phaseout of Roth IRA Contributions – AGI phase-out deduction for contributions to the Roth
IRA for (i) married filing
jointly, (ii) single or (iii) married filing separately – IRC § 408A(c)(3)(B) |
(i) $218,00 - $228,000, (ii) $138,000 - $153,000, (iii) 0 - $10,000 |
(i) $230,000 - $240,000,
(ii) $146,000 - $161,000, (iii) 0 - $10,000 |
Saver’s Credit – A “saver’s credit” under IRC § 25B(b) provides a
tax credit for salary deferrals to a 401(k) or 403(b) plan or contributions
to an IRA for those with AGI below a certain level, with a credit (for
married filing jointly) of (i) 50% of contribution if AGI is not more than a
specified dollar amount, (ii) 20% if AGI is in a specified dollar range and (iii)
10% if AGI is in higher specified dollar range. Single and married filing
separately have lower limits. (Effective for
plan years beginning 2027, SECURE 2.0 § 103 sunsets the § 25B saver’s credit and
replaces it with a federal matching contribution under IRC § 6433, which is 50%
of the contributions up to $2,000 per individual, but phases out if AGI is between
$41,000 and $71,000 for married filing jointly, and $20,500 to $35,500 for
single taxpayers and married filing separate returns.) |
(i) $43,500, (ii) $43,501-
$47,500, (iii) $47,501 - $73,000 |
(i) $46,000, (ii) $46,001-
$50,000, (iii) $50,001 - $76,500 |
PBGC Premium and Guaranty Adjustments |
||
PBGC Flat-Rate Premium – PBGC flat-rate premium per participant for a
single-employer plan (under ERISA § 4006 & PBGC Premium Rates webpage) |
$96 |
$101 |
PBGC Variable-Rate Premium - PBGC variable-rate premium for single-employer
plans (i) per $1,000 of Unfunded Vested Benefits, and (ii) per participant
cap. SECURE
2.0 § 349 will increase in 2025 the variable rate $52 per participant x $1000
of UVBs so that the $52 amount is indexed for inflation. |
(i) $52 |
(i) $52 (ii) $686 |
Multiemployer Premium - PBGC premium for
multiemployer plan per participant |
$35 |
$37 |
PBGC Guaranteed Benefit - PBGC guaranteed benefits
under ERISA § 4022 where PBGC is the trustee (for annual single life annuity
beginning at age 65) |
$81,000 |
$85,295.40 ($7,107.95 a month) |
FSA, HRA, HSA, and ACA Adjustments |
||
Health FSA Limit – Health FSA (flexible
spending account) limit – IRC
§ 125(i) |
$3,050 |
$3,200 |
Heath FSA Carryover – Health FSA carryover
amount |
$610 |
$640 |
HRA Contribution Limit – Health Reimbursement
Account (HRA) maximum employer contribution – Treas. Reg. § 54.9831-1(c)(3)(viii)(B) |
$1,950 |
$2,100 |
HSA Limit – Health Savings Account (HSA) deduction limit for
(i) single & (ii) family – IRC § 223(b)(2) |
(i) $3,850 (ii) $7,750 |
(i) $4,150 (ii) $8,300 |
HDHP Deductible – HDHP (with HSA) minimum
deductibles for (i) self-only or (ii) family coverage – IRC § 223(c) |
(i) $1,500 (ii) $3,000 |
(i) $1,600 (ii) $3,200 |
HDHP Out of Pocket – HDHP (with HSA) maximum
out-of-pocket amounts for (i) self-only & (ii) family coverage – IRC § 223(c) |
(i) $7,500 (ii) $15,000 |
(i) $8,050 (ii) $16,100 |
QSEHRA Limit – Qualified small employer HRA (QSEHRA)
for small business (less than 50 employees) and the maximum payments and
reimbursements (i) single coverage and (ii) family coverage – IRC § 9831(d) |
(i) $5,850 (ii) $11,800 |
(i) $6,150 (ii) $12,450 |
MSAs – Existing Archer Medical Savings Accounts have annual
deductible range (i) for single coverage & (ii) for family coverage, and
out-of-pocket maximum (iii) for single coverage and (iv) for family coverage –
IRC § 220(c)(2)(A) |
(i) $2,650 - $3,950, (ii) $5,300 - $7,900, (iii)
$5,300, |
(i) $2,800
- $4,150, |
ACA Out of Pocket Maximum – Affordable Care Act (ACA)
out-of-pocket maximum (cost-sharing) for non-grandfathered group health plans
for (i) self & (ii) family – 42 USC § 18022(c); 45 CFR § 156.130(a) |
(i) $9,100 (ii) $18,200 |
(i) $9,450 (ii) $18,900 |
ACA Affordability Rate – ACA health plan “affordability”
rate of pay (percentage of household income) for premium tax credit – IRC §
36B(c)(2)(C)(i)(II) |
9.12% |
8.50% |
ACA Pay or Play Penalties – ACA employer shared
responsibility assessments (i) if do not offer coverage to 95% of full-time
employee, penalty for each FTE; and (ii) if do offer coverage to 95% of FTEs
but is not “affordable” penalized only for employees who buy Marketplace
coverage and receive premium tax credit – IRC § 4980H |
(i) $2,880 (ii) $4,320 |
(i) $2,970 (ii) $4,460 |
Fringe Benefit Adjustments |
||
Transportation Fringe – Qualified transportation &
parking benefit – IRC §
132(f)(2) |
$300 |
$315 |
Adoption – Adoption credit or exclusion from
income (i) amount and (ii) AGI phaseout – IRC §§ 23(a)(3) & 137(a)(2) |
(i) $15,950, |
(i) $16,810,
|
LTC Deduction Limit – Long-term care premium
deduction limits for individuals (i) age 40 or less, (ii) age 41-50, (iii)
age 51-60, (iv) age 61-70 and (v) over age 70 – IRC § 213(d)(10) |
(i) $480, (ii) $890, |
(i) $470,
(ii) $880, (iii) $1,760, (iv) $4,700 & (v) $5,880 |
Social Security Adjustments |
||
Taxable Wage Base – the taxable wage base
subject to FICA (OASDI) tax (SSA Oct. 2023 COLA Fact Sheet) |
$160,200 |
$168,600 |
SS Tax up to Taxable Wage Base – Social
Security (OASDI) tax up to taxable wage base (double for self-employed) |
6.2% |
6.2% |
Medicare Tax – Medicare tax and no cap on wages (plus 0.9% Medicare tax for wages in excess of
$250,000 (joint filers) / $200,000 (single)) |
1.45% |
1.45% |
SS COLA – Social Security cost of living
increase |
8.7% |
3.2% |
Sample Penalty Adjustments |
||
DOL Penalties – Sample DOL penalties per
day for |
(i) $164 |
TBA |
Code § 409A Nonqualified Deferred Compensation Rules Revisited An article titled " Code § 409A Nonqualified Deferred Compensation R...
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11/4/2023 Charles C. Shulman, Esq. 212-380-3834 201-357-0577 cshulman@ebeclaw.com 2024 BENEFIT PLAN COST-OF-LIVING ADJUSTMENTS (with S...