Michael Huffstetler is a partner in Ivins, Phillips & Barker’s Executive Compensation and Benefits practice, where he has practiced for over 25 years, including 20 years as a partner. Mike assists clients with the drafting and interpretation of, as well as day-to-day operational, design, regulatory and other compliance issues related to, all types of tax-qualified and nonqualified plans -- from qualified 401(k) cash or deferred arrangements and cash balance plans -- to retention, severance, incentive, and stock-based compensation plans -- to health and welfare plans, Code section 125 cafeteria plans, and voluntary employee beneficiary associations (“VEBAs”).  Mr. Huffstetler has developed significant expertise in drafting and interpreting executive employment and incentive compensation arrangements, including the Code section 83, 162(m), 280G, 402, 409A, and 457A issues related to those arrangements.

Mr. Huffstetler also has expertise in payroll and employment tax issues, qualified and nonqualified plan accounting and reporting issues, and self-audit and self-correction programs using the IRS’s employee plans compliance resolution system (“EPCRS”).  And, when the IRS, DOL, and/or PBGC assert operational, qualification, or tax reporting problems with clients’ benefit plans or payroll matters, he has been particularly successful resolving controversies with governmental entities in a manner that is very favorable to the client.

In addition to working with master and prototype plans, Mr. Huffstetler also assists clients with the compensation discussion and analysis (“CD&A”) sections of their proxies, including performing the 280G calculations included in those proxies.  Although he works almost exclusively in the areas of executive compensation and employee benefits, Mr. Huffstetler also has developed expertise in issues related to the valuation of business entities.  And, as a result of his undergraduate degree in accounting and his experience practicing accounting prior to law school, Mike also advises clients on issues related to generally accepted accounting principles and methods, as well as the tax accounting principles, concepts, and methods of employee benefit plans.  Mr. Huffstetler closely follows new and proposed laws and regulations in search of employee benefit planning opportunities and income and employment tax saving opportunities for clients, particularly strategies for saving social security and hospital insurance taxes.  Representative clients include H. J. Heinz Company, American International Group, Bayer Corporation, Eaton Corporation, FedEx, and Milliken & Company.

• In addition to working with the client to bring the plan back into compliance, Mr. Huffstetler successfully negotiated the reduction to zero of an asserted IRS plan audit penalty of $10 million in a case that preceded and was instrumental to the IRS’s creation of its Employee Plans Compliance Resolution System (EPCRS) in the early 1990’s.
• Drafted an air-tight executive employment agreement for a newly hired CEO of the U.S. subsidiary of a foreign parent that withstood extensive efforts by legal counsel to the foreign parent to avoid payment under the agreement when the CEO’s employment was prematurely terminated without cause.
• Successfully negotiated the reduction to zero of an asserted employment tax penalty of $500,000.
• Developed a novel argument using an alternative accounting pronouncement that was instrumental in convincing a client’s auditors not to make a proposed accounting adjustment under a different generally accepted accounting principle.
• Instrumental in the development of the legal arguments that led to a major concession by the IRS in a gift tax audit valuation issue.
• Developed the firm’s golden parachute tax consequences spreadsheet that is used to calculate the Code section 280G consequences of and negotiate disputes in pending client acquisitions, as well as to compute the 280G consequences for purposes of the compensation discussion and analysis (“CD&A”) contained in client proxy filings.