URS » Topics » Section 409A of the Internal Revenue Code

This excerpt taken from the URS DEF 14A filed Apr 22, 2008.
Section 409A of the Internal Revenue Code
 
Section 409A, adopted as part of the American Jobs Creation Act of 2004, generally changed the tax rules relating to nonqualified deferred compensation that had not been earned and vested prior to 2005. The consequences of violating Section 409A are immediate taxation of any nonqualified deferred compensation that does not qualify as such under the new rules and the imposition of an additional excise tax on the recipient of that compensation. The Compensation Committee is in the process of amending the Company’s retirement and deferred income plans and policies, and seeking modifications to any agreements entered into with Company employees that may be implicated by Section 409A and the final regulations issued by the Internal Revenue Service relating to nonqualified deferred compensation, and expects to have such amendments and modifications completed within the current fiscal year so that unintended adverse tax consequences under Section 409A can be avoided to the extent possible.


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This excerpt taken from the URS DEF 14A filed Apr 18, 2007.
Section 409A of the Internal Revenue Code
 
Section 409A, adopted as part of the American Jobs Creation Act of 2004, generally changed the tax rules relating to nonqualified deferred compensation that had not been earned and vested prior to 2005. The consequences of violating Section 409A are immediate taxation of any nonqualified deferred compensation that does not qualify as such under the new rules and the imposition of an additional excise tax on the recipient of that compensation. Although final rules under Section 409A were not issued until April 2007, the Compensation Committee has taken Section 409A into account in determining the form and timing of compensation paid to our senior executives and other employees. As a consequence, to bring them into compliance with Section 409A, amendments were implemented to the Company’s Employee Stock Purchase Plan and certain technical changes were made in the compensation arrangements with Mr. Koffel when they were amended in December 2006 regarding the timing of certain payments due to him. With these changes, and pending any further changes that may be deemed necessary or appropriate now that the final rules have been issued, the Compensation Committee believes that all the Company’s compensation programs that constitute nonqualified deferred compensation comply with and have been administered in accordance with, or are exempt from, Section 409A.


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