The Internal Revenue Service has delivered a belated but welcome bit of news to compensation committees and corporate tax departments: a correction program to let companies fix errors in their deferred-compensation plans, so those plans can be brought into compliance with Section 409A of the tax code.

Revisions to Section 409A went into effect at the end of 2008, and companies have been enduring compliance headaches with the cumbersome new rules ever since. Tax penalties for non-compliance are severe, both for companies issuing the deferred-compensation plans and the employees who receive them. At the end of 2008 the IRS published guidance ...