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Executive Contracts and 4960 Rules

Contains material from Jul 2026
Executive Contracts and 4960 Rules
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In negotiating executive compensation agreements for tax-exempt entity executives, this presentation discusses some tax issues that may not come up in for-profit entities--most longer-term retirement, reward, or retention programs; executive fringe benefits (housing, cars, tuition-free benefits for family members, life insurance, post-retirement health, country clubs, spousal travel, board travel, security, etc.); a possible future separation agreement. In negotiating a compensation package, an entity needs to keep an eye on how these benefits and payments will “play together” under section 4960 (and for W-2 timing). This may include charting expected increases in pay, the value of benefits, and separation agreements, along with the possible use of various substantial risks of forfeiture structures to help balance the entity’s need for retention and incentives and the executive’s need to generally feel secure and rewarded.

Includes: Video Captions Audio Transcript Slides

  • Total Credit Hours:
  • 1.00
  • Credit Info
  • TX, CA, PA
  • TX MCLE credit expires: 7/31/2027
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Sessions

Credit
1. Executive Contracts and 4960 Rules (Jul 2026)

Susan P. Clark, Karen Field, Joel Levenson, Donald Neal Jr.

1.00 0.00 0.00 1.00
Downloadable Materials
Transcript (txt)
Slides (pdf) – 16 pgs

Session 1 —62 mins 1.00

Executive Contracts and 4960 Rules (Jul 2026)

In negotiating executive compensation agreements for tax-exempt entity executives, this presentation discusses some tax issues that may not come up in for-profit entities, including:

  • Most longer-term retirement, reward, or retention programs;
  • Executive fringe benefits (housing, cars, tuition-free benefits for family members, life insurance, post-retirement health, country clubs, spousal travel, board travel, security, etc.);
  • A possible future separation agreement. 

In negotiating a compensation package, an entity needs to keep an eye on how these benefits and payments will “play together” under section 4960 (and for W-2 timing). This may include charting expected increases in pay, the value of benefits, and separation agreements, along with the possible use of various substantial risks of forfeiture structures to help balance the entity’s need for retention and incentives and the executive’s need to generally feel secure and rewarded.

Originally presented: Jun 2026 Updates in Higher Education Taxation

Susan P. Clark, Emory University - Atlanta, GA
Karen Field, RSM US LLP - Washington, DC
Joel Levenson, University of Central Florida - Orlando, FL
Donald Neal Jr., University of Nebraska System - Lincoln, NE