deferred compensation

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Deferred compensation

An amount that has been earned but is not actually paid until a later date, typically through a payment plan, pension, or stock option plan.

Deferred Compensation

Money or other compensation that has been earned but not yet received by the earner. Deferred compensation is not taxed until it is actually received, and is usually taxed at a lower rate when it is received (depending on one's income later in life). The most common form of deferred compensation is a retirement plan such as an IRA or 401(k), but stock options and other pensions also qualify.

deferred compensation

Compensation that is being earned but not received, a process that defers the taxes on the compensation until it is actually received at a later date. Deferred compensation includes various plans, some being pensions, profit-sharing, and stock options.

deferred compensation

payment schemes that pay lower wages during the early years of employment in an organization and higher wages in subsequent years. With deferred compensation schemes, a worker's remuneration increases with seniority and experience, which tend to improve the worker's efficiency within the organization. Such compensation schemes tend to reduce labour turnover and reduce SHIRKING. See PAY.

Deferred Compensation

Compensation that will be taxed when received or upon the removal of certain restrictions on receipt and not when earned. For example, contributions by an employer to a qualified pension or profit-sharing plan on behalf of an employee are considered deferred compensation. Such contributions will not be taxed to the employee until the funds are made available or distributed to the employee, usually upon retirement or separation from service.
References in periodicals archive ?
Non-GAAP net income and non-GAAP earnings per share exclude the effect of stock-based compensation expense, amortization of acquisition-related intangible assets, acquisition-related transaction costs, deferred compensation plan income/expense and related tax effects.
Non-qualified deferred compensation plans are retirement plans that supplement qualified plans, such as pension plans or 401 (k) plans.
A non-qualified deferred compensation plan simply defers the payment of a portion of the employee's/independent contractor's compensation to a future date.
Employers may deduct the annual deposit, a distinct advantage over traditional deferred compensation plans.
Congress snuffed this out by freezing the law of private deferred compensation plans in place with the principles set forth in regulations, rulings, and judicial decisions in effect immediately before the publication of Prop.
Recently, the Governmental Accounting Standards Board (GASB) has proposed guidance on Internal Revenue Code (IRC) Section 457 deferred compensation plans, property tax revenue recognition criteria, and custodial credit risk classifications involving bank holding companies.
Definition of a Nonqualified Deferred Compensation Plan
Under this rule, participants in their first year of eligibility have up to 30 days after they became eligible to participate in the nonqualified deferred compensation plan to make their deferral election with respect to compensation for services to be rendered subsequent to the election.
Once a deferred compensation plan is adopted for one or more selected executives and implemented by a written agreement, the employer incurs a future liability to make specified payments.
457 covers deferred compensation plans for governmental employees.
The Principal examines nonqualified deferred compensation plan satisfaction
Under the new law, if a deferred compensation plan does not comply, deferred amounts will be includable in income and will be subject to a penalty of interest at the underpayment rate plus 1 percent, and an additional 20 percent tax penalty.