\
  The most prestigious law school admissions discussion board in the world.
BackRefresh Options Favorite

Most of the Amazon's massive write-off came from high-level executives cashing i

According to Gardner’s analysis of Amazon’s 10-K filing, mos...
talented lodge
  04/08/18
Said it before and I'll say it again...
nofapping snowy heaven queen of the night
  04/08/18
...
copper theater stage quadroon
  04/08/18
Why does this seem egregious to you? The relevant principle ...
big kitty
  04/08/18
Hold up lemme save you the time: ((( )))
big kitty
  04/08/18
...
olive pit
  04/08/18
...
rose racy stage wrinkle
  04/08/18
...
adventurous brethren step-uncle's house
  05/21/18
...
Maniacal macaca church
  05/21/18
I assumed a lawmo would have some insight here. What would t...
talented lodge
  04/08/18
hard to say. youre not alone in having the thought process t...
big kitty
  04/08/18
disincentive to use stock options which obviously are an eff...
exciting twinkling sneaky criminal internal respiration
  05/21/18
It seems like the incentive is to run a non-profitable reven...
nofapping snowy heaven queen of the night
  04/08/18
...
olive pit
  04/08/18
well stocks (and bonds and every other asset) are ultimately...
big kitty
  04/08/18
ur just regurgitating stuff you read in a textbook.
naked alcoholic garrison
  04/08/18
ok this board has waaaaay too many retarded people to be ...
big kitty
  04/08/18
The IQ obsession indicates that there are lots of retarded p...
talented lodge
  04/08/18
agreed
big kitty
  04/08/18
https://m.youtube.com/watch?v=rCZRqH7sRyA
Ivory Whorehouse
  04/08/18
Donald Trump said he's "smart" by not paying incom...
180 tattoo address
  04/08/18
lmao nobody is arguing that it isn't smart to offset against...
Up-to-no-good alcoholic party of the first part lay
  04/08/18
...
talented lodge
  04/08/18
lmao there's always some pissy amazon employee in these thre...
Infuriating Menage
  04/08/18
everyone hostile to “i’m mad as fuck at the world but i’m to...
big kitty
  04/08/18
...
big kitty
  04/09/18
isn't this an INCREASE in taxes collected by the govt? emplo...
out-of-control business firm
  05/21/18
no, because they just write it off
bearded jew
  05/21/18


Poast new message in this thread



Reply Favorite

Date: April 8th, 2018 10:22 AM
Author: talented lodge

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/

(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35790837)



Reply Favorite

Date: April 8th, 2018 10:23 AM
Author: nofapping snowy heaven queen of the night

Said it before and I'll say it again...

(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35790841)



Reply Favorite

Date: April 8th, 2018 12:09 PM
Author: copper theater stage quadroon



(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35791400)



Reply Favorite

Date: April 8th, 2018 10:24 AM
Author: big kitty

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??

(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35790844)



Reply Favorite

Date: April 8th, 2018 10:36 AM
Author: big kitty

Hold up lemme save you the time:

((( )))



(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35790890)



Reply Favorite

Date: April 8th, 2018 12:11 PM
Author: olive pit



(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35791414)



Reply Favorite

Date: April 8th, 2018 11:02 PM
Author: rose racy stage wrinkle



(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35795855)



Reply Favorite

Date: May 21st, 2018 5:55 PM
Author: adventurous brethren step-uncle's house



(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#36099319)



Reply Favorite

Date: May 21st, 2018 6:04 PM
Author: Maniacal macaca church



(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#36099375)



Reply Favorite

Date: April 8th, 2018 12:06 PM
Author: talented lodge

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)



Reply Favorite

Date: April 8th, 2018 1:09 PM
Author: big kitty

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.

(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35791739)



Reply Favorite

Date: May 21st, 2018 5:54 PM
Author: exciting twinkling sneaky criminal internal respiration

disincentive to use stock options which obviously are an effective tool in encouraging management to maximize shareholder value in the long term



(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#36099308)



Reply Favorite

Date: April 8th, 2018 12:09 PM
Author: nofapping snowy heaven queen of the night

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.



(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35791408)



Reply Favorite

Date: April 8th, 2018 12:11 PM
Author: olive pit



(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35791417)



Reply Favorite

Date: April 8th, 2018 1:13 PM
Author: big kitty

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

(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35791768)



Reply Favorite

Date: April 8th, 2018 1:20 PM
Author: naked alcoholic garrison

ur just regurgitating stuff you read in a textbook.

(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35791787)



Reply Favorite

Date: April 8th, 2018 1:30 PM
Author: big kitty

ok

this board has waaaaay too many retarded people to be so obsessed with iq lmao

(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35791863)



Reply Favorite

Date: April 8th, 2018 2:19 PM
Author: talented lodge

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)



Reply Favorite

Date: April 8th, 2018 2:26 PM
Author: big kitty

agreed

(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35792228)



Reply Favorite

Date: April 8th, 2018 10:25 AM
Author: Ivory Whorehouse

https://m.youtube.com/watch?v=rCZRqH7sRyA

(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35790848)



Reply Favorite

Date: April 8th, 2018 12:07 PM
Author: 180 tattoo address

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."

(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35791388)



Reply Favorite

Date: April 8th, 2018 12:11 PM
Author: Up-to-no-good alcoholic party of the first part lay

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)



Reply Favorite

Date: April 8th, 2018 9:37 PM
Author: talented lodge



(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35795155)



Reply Favorite

Date: April 8th, 2018 11:04 PM
Author: Infuriating Menage

lmao there's always some pissy amazon employee in these threads

(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35795879)



Reply Favorite

Date: April 8th, 2018 11:32 PM
Author: big kitty

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)



Reply Favorite

Date: April 9th, 2018 12:45 AM
Author: big kitty



(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#35796542)



Reply Favorite

Date: May 21st, 2018 5:57 PM
Author: out-of-control business firm

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)



Reply Favorite

Date: May 21st, 2018 6:04 PM
Author: bearded jew

no, because they just write it off

(http://www.autoadmit.com/thread.php?thread_id=3942652&forum_id=2#36099371)