Structuring Equity Compensation for Partnerships and LLCs: Considerations After Tax Reform
Recording of a 90-minute premium CLE/CPE webinar with Q&A
This CLE/CPE course will provide employee benefits counsel with an overview of the types of equity compensation arrangements available to partnerships and LLCs. The panel will review the impact of the new tax reform, discuss tax consequences, advantages and disadvantages, design and structuring, and implementation considerations.
Outline
- Overview of Basic Equity Compensation Alternatives
- Full Equity Interests (Capital and Profits)
- Review of Corporate Restricted Stock, Restricted Stock Units, and Phantom Stock
- Partnership / LLC Restricted Equity
- Partnership / LLC Restricted Equity Units
- Partnership / LLC Phantom Equity
- Partial Equity Interests (Profits Only)
- Review of Corporate Stock Options and Stock Appreciation Rights
- Partnership / LLC Equity Options
- Partnership / LLC Equity Appreciation Rights
- Partnership / LLC Profits Interests
- Hybrid Interests
- Profits Interest with “Catch Up” Allocations
- Gain Sharing Interests
- Holding Company Arrangements
- Conclusion
Benefits
The panel will review these and other key issues:
- How does a capital interest differ from a profit interest?
- Should a Section 83(b) election be made for unvested interests?
- What are the requirements for valuing capital interests and setting the distribution threshold for profits interests, particularly in the case of serial issuances?
- What are the capital account maintenance considerations for alternative forms of partnership / LLC equity grants equity grants?
- What are the differing federal and state income tax compliance aspects of alternative forms of partnership / LLC equity grants?
- Does Section 409A apply to a partnership / LLC equity grant?
- Can a partner or LLC member receiving an equity interest also be an employee of the entity?
- What are the alternatives for handling equity compensation grants when a partnership / LLC is acquired or converts to a C corporation?
Faculty
James R. Browne
Partner
Barnes & Thornburg
Mr. Browne advises clients on the U.S. income tax aspects of domestic and international business transactions and... | Read More
Mr. Browne advises clients on the U.S. income tax aspects of domestic and international business transactions and matters involving federal, state and foreign taxes. With more than 35 years of experience, he handles complicated tax and financing issues for a diverse range of clients. He has experience advising sellers and purchasers on tax aspects of business acquisitions involving both strategic and financial purchasers, preparing tax disclosures for debt and equity offering documents, advising clients on tax aspects of forming, funding, and reorganizing corporate and partnership entities, and advising clients on tax and financing aspects of international operations.
Close
Lori L. Shannon
Partner
Barnes & Thornburg
Ms. Shannon counsels private and public companies and tax-exempt entities on the design and implementation of... | Read More
Ms. Shannon counsels private and public companies and tax-exempt entities on the design and implementation of employee benefit and executive compensation plans and arrangements. She advises clients in regard to tax-qualified retirement plans, 403(b) plans, health and welfare benefit plans, nonqualified deferred compensation plans and equity-based incentive plans. Ms. Shannon assists clients, many in the professional services arena, with the design and drafting of executive and physician employment agreements, as well as severance, retention and change in control agreements.
Close