IRS practice unit: Deferred compensation received by nonresident alien individuals
The practice unit discusses payments to nonresident aliens from four types of deferred compensation plans.
Payments to nonresident aliens from four types of deferred compensation plans
The IRS Large Business and International (LB&I) division today publicly released a “practice unit”—part of a series of IRS examiner “job aides” and training materials intended to describe for IRS agents leading practices about tax concepts in general and specific types of transactions.
The title of the “concept unit” (as referred to by the IRS) is: Deferred compensation received by nonresident alien individuals
This practice unit discusses payments to nonresident aliens from four types of deferred compensation plans:
- Salary deferral—unfunded deferred compensation plans under which U.S. taxation is deferred until payment is made
- Distributions from a tax-qualified retirement plan (usually a pension or profit-sharing plan) of a U.S. company
- Payments made by a U.S. company under an unfunded “top hat” retirement plan for key employees
- Income arising under an equity-based compensation plan (employee stock option plan or restricted stock plan)
Read the process unit on the IRS practice unit webpage (posting date of March 31, 2022).
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