The Republican tax plan proposes to eliminate a decades-old rule that’s been blamed for fueling the meteoric rise of executive compensation at U.S. companies, and could upend popular retirement-savings programs used by scores of high-placed corporate leaders.
Under current law, businesses can write off as much as $1 million in compensation expenses for chief executive officers and four other top-paid bosses, plus any amount beyond that if it’s tied to performance targets. The Republican proposal unveiled Thursday would keep the $1 million threshold but eliminate the exemption for pay linked to results, denying companies the option to write off large equity awards.
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