Kirkland Alert Kirkland & Ellis LLP

Section 162(m): Severance Provisions Invalidate Performance Exception

On February 21, 2008, the IRS issued Revenue Ruling 2008-13 addressing the application of the performance-based compensation rules under Section 162(m) of the Internal Revenue Code of 1986. This alert discusses the events that led to the issuance of the Ruling and the Ruling’s implications for public company executive compensation planning.