### Question
How is the term nonqualified deferred compensation plan defined?


### Answer
The term **nonqualified deferred compensation plan** is defined in *26 U.S.C. § 409A* as the following:

> any plan that provides for the deferral of compensation, other than—



(A) a qualified employer plan, and



(B) any bona fide vacation leave, sick leave, compensatory time, disability pay, or death benefit plan

#### Citation:
  - *26 U.S.C. § 409A*
  - Heading: **Subtitle A-Income Taxes > CHAPTER 1-NORMAL TAXES AND SURTAXES > Subchapter D-Deferred Compensation, Etc. > PART I-PENSION, PROFIT-SHARING, STOCK BONUS PLANS, ETC. > Subpart A-General Rule**

