For compensation plans adopted by a company in 2019,when a publicly traded CEO's salary exceeds $1,000,000,the employee ________ taxed on the entire amount,and the employer ________ allowed a deduction on the entire amount.
A)is; is
B)is; is not
C)is not; is
D)is not; is not

Question

Quizplus · Accepted Answer

According to the Internal Revenue Code Section 162(m), a publicly traded company cannot deduct executive compensation greater than $1,000,000 unless it falls under certain exceptions. Therefore, the employer is not allowed a deduction on the entire amount. However, the employee is still taxed on the entire amount.

For Compensation Plans Adopted by a Company in 2019,when a Publicly