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View Diary: Lottery Winners Taxed More than CEOs (42 comments)

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  •  HR - for a diary title that is a LIE (2+ / 0-)
    Recommended by:
    johnny wurster, coffeetalk

    Non-Qualified Stock Options CANNOT QUALIFY for long term capital gains treatment. The diary author has now been told this at least ten times by me and other tax experts here at DKOS. Please stop writing things that are not factual and add to the echo of misinformation here at DKOS and the Internet generally. There is no way to structure non-qualified stock options, the type that executives receive, that qualifies the income as long term capital gains. ALL INCENTIVE EQUITY COMPENSATION of Fortune 1000 executives is taxed at the top marginal earned income rates and is reported as W2 income.

    "let's talk about that"

    by VClib on Sun Mar 31, 2013 at 05:37:06 PM PDT

    •  Stupid me :( (1+ / 0-)
      Recommended by:

      Ok then --- Mitt Romney didn't REALLY pay a 13.9% tax rate on his $20+ million in deferred interest either. Everybody was lying, and the CEOs like Mitt Romney REALLY DO pay the top marginal income tax rates...and we were all lying...including the IRS --- and Warren Buffett, who was also lying when he said his tax rate was lower than his secretary's. Everybody is lying. The Wall Street Journal was lying when they said more and more CEOs were being paid this way. Forbes is lying, and after stock option grants are vested for one year, they REALLY AREN'T sold and taxed as long-term capital gains --- but are taxed at the top marginal rate. And SWAG investments are also taxed at the top marginal rate...NOBODY is getting a tax break and the Bush take cuts (and the 15% capital gains tax rate) was all one big frigging lie. Stupid me, and to think I believed all those damn liars.

    •  More liars, spreading false information.... (0+ / 0-)

      If  I were you I would write the liars at Forbes and tell them that Facebook is NOT getting back tax refunds worth $429 million.

      “Due to the stock option loophole, Facebook may not pay any corporate income taxes on its profits for a generation,” said Senator Carl Levin. I would write the Senator to accuse him of lying too.

      •  Ignorance must be bliss (2+ / 0-)
        Recommended by:
        VClib, johnny wurster

        and you must be very, very happy.

        Do you understand the difference between Facebook, which is an employer, and its employees?  Compensation paid to employees is generally deductible, which reduces the employer's taxable income.  The compensation is taxable (at ordinary income rates) to the employees.

        "Well, I'm sure I'd feel much worse if I weren't under such heavy sedation..."--David St. Hubbins

        by Old Left Good Left on Sun Mar 31, 2013 at 09:06:51 PM PDT

        [ Parent ]

      •  Bud - that's a completely difference issue (2+ / 0-)
        Recommended by:
        johnny wurster, nextstep

        When options are exercised and sold the option holder pays ordinary income rates. Under the current tax rules the company receives a credit for the taxes paid by the option holders. That is true. It has nothing to do with the tax characteristics of options to the option holder other than the fact that by paying ordinary income rates the credit is larger. In the Facebook example some of the founders and early employees were holding shares and not options. Those shares qualified for long term capital gains treatment, but the company received no tax credit.

        The problem is that you have no fundamental understanding of the tax code, particularly as it relates to equity awarded as compensation. Because you have no background you misinterpret the material you read. And that's OK, once or twice, but you have had real tax professional here at DKOS inform you that you continue to write about things that aren't true, thereby misinforming the other readers here. You are more than welcome to write about the inequity in the tax code, and there is plenty, but please stop writing that executive stock options are taxed at long term capital gains rates. It's not true.

        "let's talk about that"

        by VClib on Sun Mar 31, 2013 at 09:08:54 PM PDT

        [ Parent ]

        •  I posted this JUST for you (0+ / 0-)

          "Tax Advantages for the CEO with Stock Options" -- and I left a comment. (Sourced from the IRS)

          •  Bud - I went to your site and read it (2+ / 0-)
            Recommended by:
            unfangus, nextstep

            Please understand that executives receive only Non-statuatory (Non-qualified) stock options, not ISOs available to most employees. There is nothing in the material on your site that is in conflict with what I have written. This really goes back to your fundamental lack of knowledge of tax law and the IRS code. You continue to misunderstand what you are reading and write incorrect diaries about tax issues. There is only one place where you continue to make mistakes, the issue of the taxation of equity incentive compensation. You write about many useful topics. Just drop the part that isn't true.

            "let's talk about that"

            by VClib on Mon Apr 01, 2013 at 07:13:41 AM PDT

            [ Parent ]

    •  ---- (0+ / 0-)

      Changed title...will that make people happy campers?

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