Section 162m final regulations substantially unchanged

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January 2021


Treasury and the IRS have issued final regulations under Section 162(m) which imposes a $1 million limit on certain compensation deductions. The final regulations adopt most of the positions taken in the proposed regulations, providing limited additional relief for ‘Up-C’ structures (a public holding corporation that owns an operating partnership) and clarifications to some of the other rules.

The takeaway

Although the final regulations largely reflect the proposed regulations, publicly held corporations should review their tax positions and records to determine whether they align with the various effective dates.

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Carrie Duarte

Workforce of the Future, Deals Leader, PwC US

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