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hghg1h t1_isbymui wrote

Is this accurate? How can a corp pay 70% tax?

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Street-Individual292 t1_isdncun wrote

Stock compensation isn’t tax deductible until it’s vested, so an IPO year is going to have a huge upward adjustment. The following year, their rate was 35%

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ApprehensiveWhale t1_iscikee wrote

Their employees excised their stock options early. If you hold stock options before converting them to stocks then it gets treated as capital gains. If you excise before the holding period is up it gets treated as ordinary income instead.

If I'm reading their 10-K right (it's been a long time since I studied financial & tax accounting), they held a provision in 2003 for early conversions, which was reduced in 2004 by $42m.

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