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On April 2, 2013, the Treasury Department and the IRS issued proposed regulations under section 162(m)(6) of the Internal Revenue Code, which generally imposes an annual $500,000 limitation on the amount that certain health insurers and their affiliates (“Covered Health Insurance Providers” or “CHIPs”) may deduct for compensation paid to an employee. This limitation is contained within section 162(m) of the Code, which historically has governed the deductibility of compensation paid by public companies to certain of their senior executive officers. However, the $500,000 limitation in subpart (6) of section 162(m) is much broader in scope and applies to all CHIPs, whether public or private, and to all of a CHIP’s current or former officers, directors, employees and related service providers.