IRSProposed Rule
Certain Employee Remuneration in Excess of 1,000,000 Dollars under Internal Revenue Code
Finance & BankingLabor & Workplace
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Summary
The IRS is proposing a new rule about how to handle employee pay that exceeds $1 million per year. This regulation would clarify tax rules for high-earning employees and could affect how companies report and tax very large salaries and bonuses.
Key Points
- 1The rule targets employee compensation packages worth more than $1 million annually, which is a small percentage of U.S. workers
- 2It clarifies how the IRS should treat extremely high salaries, bonuses, and other forms of compensation for tax purposes
- 3Companies and high-income earners will need to understand new reporting requirements when compensation crosses the $1 million threshold
- 4The public can submit comments on this proposed rule until March 18, 2025, before the IRS makes a final decision
- 5Once finalized, the regulation will likely affect tax calculations and reporting for executives, athletes, entertainers, and other top earners
Key Dates
Published
January 16, 2025
This summary is for informational purposes only. It may not capture all nuances of the regulation. Always refer to the official text for authoritative information.
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