Treasury Regulations · 26 CFR
§ 1.404(b)-1. Method of contribution, etc., having the effect of a plan; effect of section 404(b).
Regulation text, no changes From the eCFR, current as of October 15, 2026. The eCFR is an authoritative but unofficial editorial compilation of the Code of Federal Regulations; the official text is the annual CFR on govinfo. Compare it with this section on ecfr.gov (external site) or the official annual CFR on govinfo (external site).
Regulation under 26 U.S.C. § 404(b)
Cite as 26 CFR § 1.404(b)-1
At a glance
Read from the text and its source citation. Not part of the regulation.
- Status
- In the current eCFR
- Issued
- November 26, 1960 by T.D. 6500
- Issued under
- 26 U.S.C. § 404(b)
- Length
- 288 words · about 1 min to read
- Cross-references
- cites 1 Code section and 0 regulations; cited by 0
Section 404(a) is not confined to formal stock bonus, pension, profit- sharing, and annuity plans, or deferred compensation plans, but it includes any method of contributions or compensation having the effect of a stock bonus, pension, profit-sharing, or annuity plan, or similar plan deferring the receipt of compensation. Thus, where a corporation pays pensions to a retired employee or employees or to their beneficiaries in such amounts as may be determined from time to time by the board of directors or responsible officers of the company, or where a corporation is under an obligation, whether funded or unfunded, to pay a pension or other deferred compensation to an employee or his beneficiaries, there is a method having the effect of a plan deferring the receipt of compensation for which deductions are governed by section 404(a). If an employer on the accrual basis defers paying any compensation to an employee until a later year or years under an arrangement having the effect of a stock bonus, pension, profit-sharing, or annuity plan, or similar plan deferring the receipt of compensation, he shall not be allowed a deduction until the year in which the compensation is paid. This provision is not intended to cover the case where an employer on the accrual basis defers payment of compensation after the year of accrual merely because of inability to pay such compensation in the year of accrual, as, for example, where the funds of the company are not sufficient to enable payment of the compensation without jeopardizing the solvency of the company, or where the liability accrues in the earlier year, but the amount payable cannot be exactly determined until the later year.
[T.D. 6500, 25 FR 11690, Nov. 26, 1960]
Cross-references
Computed from the citations in the text of 26 CFR.
Code sections it cites
Amendment history
From the source citation at the end of the section, newest first. T.D. is a Treasury decision; FR is the Federal Register.
- Issued by T.D. 6500 (25 FR 11690)
Where it sits in 26 CFR
- Subchapter A Income tax
- Part 1 Income taxes
Nearby sections
- § 1.404(a)-11 Trusts created or organized outside the United States; application of section 404(a)(4).
- § 1.404(a)-12 Contributions of an employer under a plan that does not meet the requirements of section 401(a); application of section 404(a)(5).
- § 1.404(a)-13 Contributions of an employer where deductions are allowable under section 404(a) (1) or (2) and also under section 404(a)(3); application of section 404(a)(7).
- § 1.404(a)-14 Special rules in connection with the Employee Retirement Income Security Act of 1974.
- § 1.404(b)-1 Method of contribution, etc., having the effect of a plan; effect of section 404(b).
- § 1.404(b)-1T Method or arrangement of contributions, etc., deferring the receipt of compensation or providing for deferred benefits. (Temporary)
- § 1.404(c)-1 Certain negotiated plans; effect of section 404(c).
- § 1.404(d)-1T Questions and answers relating to deductibility of deferred compensation and deferred benefits for independent contractors. (Temporary)
- § 1.404(e)-1A Contributions on behalf of a self-employed individual to or under a qualified pension, annuity, or profit-sharing plan.