I know this all along but just never made the connection until now, Google exec get $1 salary
While this is a good publicity stun the real purpose is to avoid taxes! You have to be paid something so $1, and the bonus from investment is taxes at different bracket than normal w-2 income. I should demand people pay me in qaulify ordinary dividends going forward.
$1 salary
Steve Jobs did the same thing several years back and earned him a listing in the Guinness World Records as the "Lowest Paid Chief Executive Officer".
What Google needs todo is pay their execs... $0.99....
Excerpt from wiki (for teh win!!)
"Jobs worked at Apple for several years with an annual salary of US$1, and this earned him a listing in Guinness World Records as the "Lowest Paid Chief Executive Officer." At the 2000 keynote speech of Macworld Expo in San Francisco, the company dropped the "interim" from his title, making him permanent CEO of Apple. His current salary at Apple officially remains US$1 per year, although he has traditionally been the recipient of a number of lucrative "executive gifts" from the board, including a US$46 million jet in 1999 and just under 30 million shares of restricted stock in 2000-2002. As such, Jobs is well compensated for his efforts at Apple despite the nominal one-dollar salary. This approach reduces his personal tax liability because, under current U.S. tax law, salary income is taxed at a significantly higher rate (currently up to 35%) than the capital gains tax (currently a maximum of 15%) applied to profits arising from the sale of stock grants. Obtaining remuneration through stock instead of salary is a common extrinsic rewarding technique which ties management performance to financial benefits. Furthermore, it acts as a tax minimization strategy."
What Google needs todo is pay their execs... $0.99....
Excerpt from wiki (for teh win!!)
"Jobs worked at Apple for several years with an annual salary of US$1, and this earned him a listing in Guinness World Records as the "Lowest Paid Chief Executive Officer." At the 2000 keynote speech of Macworld Expo in San Francisco, the company dropped the "interim" from his title, making him permanent CEO of Apple. His current salary at Apple officially remains US$1 per year, although he has traditionally been the recipient of a number of lucrative "executive gifts" from the board, including a US$46 million jet in 1999 and just under 30 million shares of restricted stock in 2000-2002. As such, Jobs is well compensated for his efforts at Apple despite the nominal one-dollar salary. This approach reduces his personal tax liability because, under current U.S. tax law, salary income is taxed at a significantly higher rate (currently up to 35%) than the capital gains tax (currently a maximum of 15%) applied to profits arising from the sale of stock grants. Obtaining remuneration through stock instead of salary is a common extrinsic rewarding technique which ties management performance to financial benefits. Furthermore, it acts as a tax minimization strategy."
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Peijen
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Right, Jobs is who I am refering to when I said I never made the connection until now.
Republican can fucking suck my dick.
I am in favor of single income tax schema no matter if you work, invest, sell drugs, or suck dicks.
Also I hate it when people post this crap. Salary income is not taxed at 35%. It is much higher than that because of the social security. Not counting company contribution we pay 28% + 6% + 3% or 37% and counting company contribution, 28% + 12% + 6% = 46%. When people hit the 35% bracket they will no longer pay ss taxes, and the effective tax rate would still be lower.Vyrosama wrote:This approach reduces his personal tax liability because, under current U.S. tax law, salary income is taxed at a significantly higher rate (currently up to 35%) than the capital gains tax (currently a maximum of 15%) applied to profits arising from the sale of stock grants.
Republican can fucking suck my dick.
I am in favor of single income tax schema no matter if you work, invest, sell drugs, or suck dicks.
I'm kneejerk in favor of a homogenous tax code, though I do worry suddenly sucking twice as much money out of the stock market would cause unpredictable problems. Also, you have the weird issue that corporations, mutual funds, trusts, and all kinds of other screwy entities are playing in the same sandbox as individuals. I'm not sure you balance them all out.
As I've been thinking about this, I came up with an interesting idea. I'd like to see all investment accounts track the income for you. Whenever money goes in, the brokerage should update the basis for the account. Whenever money comes out (not sales or dividends, but actual transfers), they reduce the basis by that amount. Any excess is income. You don't report individual capital gains to the IRS, just the net. And the brokerage can do it for you, just like employers do for salaries. Obviously, this delays recovery of some taxes, but encourages savings, so it's probably good policy.
I would then require all W2s, 1099s, and other predictable adjustments (children, mortgage payments, etc) to be aggregated by the IRS. The IRS sends you a sheet of paper that says something like "we think you earned X dollars this year, with Y dollars in adjustments, meaning you owe Z dollars in tax. You had W dollars withheld. Your refund/payment is Z-W." The 0.1% of people who had other income or adjustments have to file a return. Otherwise, you just sign the sheet (or better still, click an online button) and you're done.
Of course, I'd do away with almost all adjustments. But if you can't get rid of crap like the mortgage interest tax deduction, you might as well at least automate it.
As I've been thinking about this, I came up with an interesting idea. I'd like to see all investment accounts track the income for you. Whenever money goes in, the brokerage should update the basis for the account. Whenever money comes out (not sales or dividends, but actual transfers), they reduce the basis by that amount. Any excess is income. You don't report individual capital gains to the IRS, just the net. And the brokerage can do it for you, just like employers do for salaries. Obviously, this delays recovery of some taxes, but encourages savings, so it's probably good policy.
I would then require all W2s, 1099s, and other predictable adjustments (children, mortgage payments, etc) to be aggregated by the IRS. The IRS sends you a sheet of paper that says something like "we think you earned X dollars this year, with Y dollars in adjustments, meaning you owe Z dollars in tax. You had W dollars withheld. Your refund/payment is Z-W." The 0.1% of people who had other income or adjustments have to file a return. Otherwise, you just sign the sheet (or better still, click an online button) and you're done.
Of course, I'd do away with almost all adjustments. But if you can't get rid of crap like the mortgage interest tax deduction, you might as well at least automate it.