Notice 2019-09, issued today, provides interim guidance on the provisions of section 4960, which was added by the 2017 Tax Cuts and Jobs Act. Section 4960 provides that remuneration in excess of $1 million and excess parachute payments paid by an applicable tax-exempt organization to a covered employee are subject to a 21% excise tax. This notice provides interim guidance defining (1) applicable tax-exempt organization; (2) excess remuneration; (3) covered employee; and (4) excess parachute payment. The interim guidance is intended to assist taxpayers in applying section 4960 while regulations are being developed. The Treasury Department and the IRS intend to issue proposed regulations that will incorporate the guidance provided in the notice. Any future guidance under section 4960 will be prospective and will not apply to taxable years beginning before the issuance of that guidance. Taxpayers may base their positions upon a good faith, reasonable interpretation of the statute, including consideration of the legislative history. The positions reflected in the notice are regarded as constituting a good faith, reasonable interpretation of the statute. Whether a taxpayer’s position that is inconsistent with the notice constitutes a good faith, reasonable interpretation of the statute generally will be determined based upon all of the relevant facts and circumstances. However, the notice describes certain positions that the Treasury Department and the IRS have concluded are not consistent with a good faith, reasonable interpretation of the statutory language. The Treasury Department and the IRS intend to embody these positions as part of the forthcoming proposed regulations.