This excerpt taken from the EQR DEF 14A filed Apr 16, 2009.
Tax Deductibility of Compensation
Section 162(m) of the Internal Revenue Code of 1986, as amended (IRC), limits the deductibility on the Companys tax return of compensation over $1 million to any covered employee unless, in general, the compensation is paid pursuant to a plan which is performance-related, non-discretionary and has been approved by the Companys shareholders. The Company believes that because it qualifies as a real estate investment trust under the IRC and pays dividends sufficient to minimize federal income taxes, the payment of compensation that may not satisfy the requirements of Section 162(m) will generally not materially affect the Companys net income. For these reasons, the Compensation Committees compensation policy and practices are not directly guided by considerations relating to Section 162(m).