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Most of the Amazon's massive write-off came from high-level executives cashing i
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Date: April 8th, 2018 10:22 AM Author: laughsome kitchen goal in life According to Gardner’s analysis of Amazon’s 10-K filing, most of the company’s massive write-off—nearly $1 billion—came from high-level executives cashing in stock options. That’s right: When employees sell their stock, employers get to claim the entire value of that deduction. Say the company gave a VP $1 million in stock in 2008, when it was valued at around $70 a share. Those stocks would be worth more than $20 million if cashed out now—and Amazon could take the whole thing as a write-off. According its 10-K filing, Amazon’s execs cashed out nearly $1 billion in stock options last year, negating most of the year’s federal tax bill.
https://newfoodeconomy.org/amazon-whole-foods-a-whole-federal-tax-doorbell-ring/ |
Date: April 8th, 2018 10:23 AM Author: Irradiated hot market prole Said it before and I'll say it again... (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35790841) |
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Date: April 8th, 2018 12:09 PM Author: Glittery church building jew (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35791400) |
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Date: April 8th, 2018 10:24 AM Author: Cheese-eating trailer park Why does this seem egregious to you? The relevant principle here is you pay tax on profits, not just revenues. I assume this seems fair to you.
How do you calculate the value of compensation paid on employee stock options? Is it (a) the value of the options upon issuance (using black-scholes, so based on stock price volatility, prevailing interest rates, etc) or (b) the value of the underlying shares whenever employees actually exercise the options? GAAP says (a) but the IRS says (b).
The “write off” here (write off is the wrong term) is from Amazon’s stock skyrocketing during the period after the options were issued and when the employees exercised them. Basically they took a deduction for accounting taxes (but not cash taxes) upon issuing the options and then adjusted for actual cash tax savings upon issuing the shares.
The value being transferred from shareholders to employees is obviously higher when the stock price is higher - why shouldn’t the shareholders benefit from a proportionate deduction on compensation expense?? |
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Date: April 8th, 2018 10:36 AM Author: Cheese-eating trailer park Hold up lemme save you the time:
((( )))
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Date: April 8th, 2018 12:11 PM Author: Talented Buff Patrolman Orchestra Pit (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35791414) |
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Date: April 8th, 2018 11:02 PM Author: Comical lake windowlicker (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35795855) |
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Date: May 21st, 2018 5:55 PM Author: Vigorous Maniacal Digit Ratio Shrine (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#36099319) |
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Date: May 21st, 2018 6:04 PM Author: Offensive bisexual masturbator partner (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#36099375) |
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Date: April 8th, 2018 12:06 PM Author: laughsome kitchen goal in life I assumed a lawmo would have some insight here. What would the effect be if companies could only write off the value upon issuance and not adjust for the exercised value? (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35791375) |
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Date: April 8th, 2018 1:09 PM Author: Cheese-eating trailer park hard to say. youre not alone in having the thought process that led to this question tho: it seems unfair to let companies pay employees compensation worth X but then deduct a number >>> X when they actually issue the stock.
then again im sure there are a bunch of employees at GE with $60 strike price options that'll happily confirm that you don't always get to exercise employee stock options. |
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Date: May 21st, 2018 5:54 PM Author: Titillating crotch stage disincentive to use stock options which obviously are an effective tool in encouraging management to maximize shareholder value in the long term
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Date: April 8th, 2018 12:09 PM Author: Irradiated hot market prole It seems like the incentive is to run a non-profitable revenue growth company and to use your stock as currency, where the stock is valued off of growth in revenue and not profits (net income). Given a long enough time scale this creates extreme distortions
Having stock be used as currency to pay for acquisitions, pay employees and to raise capital to continue profit-less revenue growth distorts markets and value.
The extreme example of this is what AOL did with Time-Warner - used their ridiculously overvalued stock as currency to acquire an actually profitable company and look what happened.
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Date: April 8th, 2018 12:11 PM Author: Talented Buff Patrolman Orchestra Pit (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35791417) |
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Date: April 8th, 2018 1:13 PM Author: Cheese-eating trailer park well stocks (and bonds and every other asset) are ultimately only valued based on cash flow. you can't eat net income.
early stage tech and pharma companies are valued based on revenue (or other metrics like page views), but only as a proxy for future cash flow. you can't actually not generate cash flow into perpetuity (ask elon musk).
amazon is a special case because people saw its immense potential relatively quickly - 99.999% of companies couldn't recreate their approach to stock based comp and stuff |
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Date: April 8th, 2018 1:20 PM Author: Provocative mint property ur just regurgitating stuff you read in a textbook. (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35791787) |
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Date: April 8th, 2018 1:30 PM Author: Cheese-eating trailer park ok
this board has waaaaay too many retarded people to be so obsessed with iq lmao |
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Date: April 8th, 2018 2:19 PM Author: laughsome kitchen goal in life The IQ obsession indicates that there are lots of retarded people on here (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35792177) |
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Date: April 8th, 2018 2:26 PM Author: Cheese-eating trailer park agreed (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35792228) |
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Date: April 8th, 2018 10:25 AM Author: jade overrated travel guidebook https://m.youtube.com/watch?v=rCZRqH7sRyA (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35790848) |
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Date: April 8th, 2018 12:07 PM Author: carnelian thriller locus Donald Trump said he's "smart" by not paying income taxes — and argued that if he did, the money would be "squandered."
Trump's jaw-dropping statements came after Hillary Clinton launched a fiery attack on the Republican presidential nominee for breaking a four-decade tradition of White House aspirants releasing their federal income tax returns.
"The only years that anybody's ever seen were a couple of years when he had to turn them over to state authorities when he was trying to get a casino license, and they showed he didn't pay any federal income tax," Clinton said.
Trump quickly retorted: "That makes me smart." |
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Date: April 8th, 2018 12:11 PM Author: Amethyst Address lmao nobody is arguing that it isn't smart to offset against taxable income. (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35791418) |
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Date: April 8th, 2018 9:37 PM Author: laughsome kitchen goal in life (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35795155) |
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Date: April 8th, 2018 11:04 PM Author: Flushed Effete Dopamine School Cafeteria lmao there's always some pissy amazon employee in these threads (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35795879) |
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Date: April 8th, 2018 11:32 PM Author: Cheese-eating trailer park everyone hostile to “i’m mad as fuck at the world but i’m too dumb to know why” is an amazon employee? (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35796137) |
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Date: April 9th, 2018 12:45 AM Author: Cheese-eating trailer park (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35796542) |
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Date: May 21st, 2018 5:57 PM Author: pale jet-lagged meetinghouse isn't this an INCREASE in taxes collected by the govt? employees must include an equal amount of income from NQSOs as the comp deduction taken by the company, and these guys are in the highest federal bracket which is higher than the new corp tax rate. (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#36099333) |
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Date: May 21st, 2018 6:04 PM Author: geriatric business firm incel no, because they just write it off (http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#36099371) |