436 
‘‘(III) substantially all of any 
gain on the disposition of which (other 
than such deferred compensation) is al-
located to investors in such entity. 
‘‘(iii) COORDINATION
WITH
SPECIAL 
RULE.—Paragraph (3)(B) shall not apply 
to any compensation to which clause (i) ap-
plies. 
‘‘(2) COMPREHENSIVE FOREIGN INCOME TAX.— 
The term ‘comprehensive foreign income tax’ means, 
with respect to any foreign person, the income tax of 
a foreign country if— 
‘‘(A) such person is eligible for the benefits 
of a comprehensive income tax treaty between 
such foreign country and the United States, or 
‘‘(B) such person demonstrates to the satis-
faction of the Secretary that such foreign country 
has a comprehensive income tax. 
‘‘(3) NONQUALIFIED DEFERRED COMPENSATION 
PLAN.— 
‘‘(A) IN GENERAL.—The term ‘nonqualified 
deferred compensation plan’ has the meaning 
given such term under section 409A(d), except 
that such term shall include any plan that pro-
vides a right to compensation based on the ap-
437 
preciation in value of a specified number of eq-
uity units of the service recipient. 
‘‘(B) EXCEPTION.—Compensation shall not 
be treated as deferred for purposes of this section 
if the service provider receives payment of such 
compensation not later than 12 months after the 
end of the taxable year of the service recipient 
during which the right to the payment of such 
compensation is no longer subject to a substan-
tial risk of forfeiture. 
‘‘(4) EXCEPTION
FOR
CERTAIN
COMPENSATION 
WITH
RESPECT
TO
EFFECTIVELY
CONNECTED
IN-
COME.—In the case a foreign corporation with income 
which is taxable under section 882, this section shall 
not apply to compensation which, had such com-
pensation had been paid in cash on the date that such 
compensation ceased to be subject to a substantial risk 
of forfeiture, would have been deductible by such for-
eign corporation against such income. 
‘‘(5) APPLICATION OF RULES.—Rules similar to 
the rules of paragraphs (5) and (6) of section 409A(d) 
shall apply. 
‘‘(e) REGULATIONS.—The Secretary shall prescribe 
such regulations as may be necessary or appropriate to 
carry out the purposes of this section, including regulations
438 
disregarding a substantial risk of forfeiture in cases where 
necessary to carry out the purposes of this section.’’. 
(b) CONFORMING AMENDMENT.—Section 26(b)(2), as 
amended by the Housing Assistance Tax Act of 2008, is 
amended by striking ‘‘and’’ at the end of subparagraph (V), 
by striking the period at the end of subparagraph (W) and 
inserting ‘‘, and’’, and by adding at the end the following 
new subparagraph: 
‘‘(X) section 457A(c)(1)(B) (relating to de-
terminability of amounts of compensation).’’. 
(c) CLERICAL AMENDMENT.—The table of sections of 
subpart B of part II of subchapter E of chapter 1 is amend-
ed by inserting after the item relating to section 457 the 
following new item: 
‘‘Sec. 457A. Nonqualified deferred compensation from certain tax indifferent par-
ties.’’. 
(d) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided 
in this subsection, the amendments made by this sec-
tion shall apply to amounts deferred which are attrib-
utable to services performed after December 31, 2008. 
(2) APPLICATION TO EXISTING DEFERRALS.—In 
the case of any amount deferred to which the amend-
ments made by this section do not apply solely by 
reason of the fact that the amount is attributable to 
services performed before January 1, 2009, to the ex-
439 
tent such amount is not includible in gross income in 
a taxable year beginning before 2018, such amounts 
shall be includible in gross income in the later of— 
(A) the last taxable year beginning before 
2018, or 
(B) the taxable year in which there is no 
substantial risk of forfeiture of the rights to such 
compensation (determined in the same manner 
as determined for purposes of section 457A of the 
Internal Revenue Code of 1986, as added by this 
section). 
(3) ACCELERATED
PAYMENTS.—No later than 
120 days after the date of the enactment of this Act, 
the Secretary shall issue guidance providing a limited 
period of time during which a nonqualified deferred 
compensation arrangement attributable to services 
performed on or before December 31, 2008, may, with-
out violating the requirements of section 409A(a) of 
the Internal Revenue Code of 1986, be amended to 
conform the date of distribution to the date the 
amounts are required to be included in income. 
(4) CERTAIN BACK-TO-BACK ARRANGEMENTS.—If 
the taxpayer is also a service recipient and maintains 
one or more nonqualified deferred compensation ar-
rangements for its service providers under which any
440 
amount is attributable to services performed on or be-
fore December 31, 2008, the guidance issued under 
paragraph (4) shall permit such arrangements to be 
amended to conform the dates of distribution under 
such arrangement to the date amounts are required to 
be included in the income of such taxpayer under this 
subsection. 
(5) ACCELERATED PAYMENT NOT TREATED AS 
MATERIAL
MODIFICATION.—Any amendment to a 
nonqualified 
deferred 
compensation 
arrangement 
made pursuant to paragraph (4) or (5) shall not be 
treated as a material modification of the arrangement 
for purposes of section 409A of the Internal Revenue 
Code of 1986. 
Amend the title so as to read: ‘‘An Act to provide 
authority for the Federal Government to purchase and 
insure certain types of troubled assets for the purposes 
of providing stability to and preventing disruption in the 
economy and financial system and protecting taxpayers, 
to amend the Internal Revenue Code of 1986 to provide 
incentives for energy production and conservation, to ex-
tend certain expiring provisions, to provide individual in-
come tax relief, and for other purpose’’. 
Attest: 
Secretary.