Summary
Target Corporation (TGT) filed an 8-K on January 12, 2021, detailing an update to its Executive Officer Cash Incentive Plan. The Human Resources & Compensation Committee adopted a new plan that will replace the previous one for awards granted after January 31, 2021. This change primarily involves removing references and requirements related to Section 162(m) of the Internal Revenue Code.
Key Highlights
- 1New Executive Officer Cash Incentive Plan adopted.
- 2Plan replaces the prior executive cash incentive plan for awards granted after January 31, 2021.
- 3The new plan is substantially similar to the previous one.
- 4Key change is the removal of references to Section 162(m) of the Internal Revenue Code.
- 5This adjustment is due to the repeal of the Section 162(m) exemption by the Tax Cuts and Jobs Act of 2017.
Frequently Asked Questions
The main purpose of this filing is to announce the adoption of a new Executive Officer Cash Incentive Plan by Target Corporation, which will replace the existing plan for future awards.
The new plan is largely similar to the prior plan, with the primary change being the removal of specific references and requirements pertaining to qualified performance-based compensation under Section 162(m) of the Internal Revenue Code. This modification is a consequence of the repeal of the Section 162(m) exemption.
The new plan will apply to cash incentive awards granted after January 31, 2021.
While the core structure of the plan remains similar, the removal of Section 162(m) references indicates an adaptation to current tax legislation, which may have implications for the deductibility of certain executive compensation components for the company.