Which of the following is true concerning employer funding of nonqualified deferred compensation plans?
A)Employers are required to invest salary deferred by employees in investments specified by the employees.
B)Employers are required to annually fund their deferred compensation obligations to employees.
C)Employers annually deduct the amount earned by employees under the plan.
D)Employers may discriminate in terms of who they allow to participate in the plan.

Question

Quizplus · Accepted Answer

Employers may choose to limit participation in nonqualified deferred compensation plans to certain employees or groups of employees, although they must still comply with discrimination rules under Section 409A of the Internal Revenue Code. Employers are not required to invest employee contributions in specific investments, but they are required to fund their deferred compensation obligations to employees at the specified time. Employers do not annually deduct the amount earned by employees under the plan.

Which of the Following Is True Concerning Employer Funding of Nonqualified