are funded deferred compensation plans governed under ERISA.

does it matter if they are funded or unfunded?


thanks

Yes funded nq plans are covered under ERISA and are subject to the reporting, eligibility, vesting, nonalienation, funding and fiduciary requirements of ERISA. By funded I mean plans which have assets in a trust which is not subject to the claims of the employer's creditors under IRC 83. In a funded nq plan the participants are taxed on their benefits to the extent vested in the year the employer makes contributions to the plan, not when the benefits are paid to the participant. In an unfunded plan the employee will not be taxed on the vested benefits until the funds are paid or made available.

Unfunded nonqualified plans are subject to ERISA, although compliance is basically limited to filing a one page notice with the DOL.