Still important to heed proposed 457 rules

3 steps to better SERP oversight

Enron’s financial meltdown in 2001 still echoes across the regulatory landscape, including proposed new rules for Internal Revenue Codes 457 and 409A  that have awaited the U.S. Department of the Treasury’s approval for over a year. Some of these rules clarify key aspects of the non-qualified deferred compensation components credit unions often use in supplemental executive retirement plans.

Although these proposed final rules haven’t been approved yet, they offer useful guidance for credit unions.

If you’re designing or revising NQDC plans for your executives, there’s no need to wait for these rules to be approved. But be aware of them, and make sure your plan provider is taking them into account. If these rules are implemented, they may not require changes to your plan design, but they clarify how and when taxes could be assessed to the executives.


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