The IRS and Treasury Department have proposed new regulations regarding the deduction limits on high employee salaries, specifically affecting public corporations. According to section 162(m) of the Internal Revenue Code, deductions for employee pay over $1,000,000 are limited, and this proposal incorporates amendments from the American Rescue Plan Act of 2021. The regulations now consider more employees, including those in affiliated corporate groups, as part of this deduction limit. Public feedback is being accepted until March 17, 2025, and organizations are encouraged to comment electronically.
Simple Explanation
The government wants to set some new rules to make sure companies can't save money on their taxes by paying certain employees more than $1,000,000 each year, and they want people to share their thoughts about these rules by March 17, 2025.