2/26 http://www.bayarea.com/mld/bayarea/business/technology/2745994.htm
This is what Silicon Valley does to you, kiddies.
\_ Greed kills. From each according to his means. To each according
to his needs. It's the only moral way to live one's life.
\_ Hi paolo!
\_ who is paolo?
\_ he used to be president. Good guy.
\_ we quote him all the time
\_ Greed didn't kill. Stupidity did. See below.
\_ I read below. Greed kills. From each and to each as I
said before. Anything else is immoral. -!paolo
\_ I d love to respond, but need a little more subtlety
of position. This is just classic Marx.
\_ Marx was right. Look around you at the world today.
There's nothing wrong with pure communism. The man's
societal driven selfishness and greed killed him.
\_ Think _Utopia_, by Thomas Aquinas. Much older than Marx.
\_ Show me a society under 'pure communism'. I have
some societies under capitalism. Let's compare.
\_ There are no societies under "pure capitalism".
Everyone uses a mixed economy these days.
\_ What a way to avoid the question. Alright,
I pick the US, the closest thing we have
to pure capitalism. You pick whatever
country you think is or was closest to
pure communism (China, Cuba, N. Korea,
Russia in its heyday). Let's compare.
\_ Marx is good at pointing out the
problems of capitalism, but he doesn't
have a good, practical alternative.
Actually, one does exist, which is to
couple capitalism with a good dose
of good solid Christian values, and
a little bit of Thomas Whatever. In
short, paolo is not wrong, but the "from
each" and "to each" parts have to be
mostly voluntary instead of externally
imposed. - christian fuckhead
imposed. That's why it is very important
for the country to have good solid Christian
values because otherwise, all the ills
of capitalism will get worse and worse.
And when I say good solid Christian
values, I don't mean the values of
those ultra right-wing fake Christian
Pharisee fuckheads who make me puke.
- left-wing christian fuckhead
\_ I hope you are right and human idiocy
can be cured by the right environment,
but I am not as optimistic. Also,
the 'Christian' in good values is
incidental. Most good people I know
are not Christian, and most
Christians I know are not good people.
\_ what have you got against Marx? Groucho was one
of the finest thinkers of our times.
they should suffer the consequence.
\_ It's also Christian.
\_ Think _Utopia_, by Thomas Aquinas. Much older than
Marx.
\_ Thomas More not Thomas Aquinas.
that may be a different story.
There's about a 300 year difference. --ulysses
\_ Actually, it's the best immoral way to steal from others' lives.
\_ From the description in this article, the MIT genius didn't
bother to consult a tax lawyer before selling all his options
and retiring. Its is own damn fault for not doing his homework.
If you are in this business you should understand the tax
consequences of options etc. AMT may be a killer, but you can
plan for it. If you can't afford the AMT, then you shouldn't
be playing.
\_ Yeah, but these vicious tax laws help no one.
\_ Sure they are! They are helping kittens and small children!
They are helping us to promote diversity, and leverage
various special interest synergies!
\_ and they're even helping objectivist fools like you
\_ Well, I see I require personal growth before I can
grasp your more mature, 'progressive' point of view.
\_ Granted AMT is evil. But it is the LAW. I agree that AMT
should be overturned, but its not like AMT lead to this
guy's death. Failing to do his "homework" lead to his
death. If he had just spent the time to do the AMT calc.
then he could have retired with like $4 mil in the bank.
And what sort of an idiot goes all to stock. Out of $5
mil wouldn't it be prudent to go $1 mil cash in a irrevocable
off-shore trust?
\_ Plus you don't even need a tax lawyer to get a rough idea on how
much AMT will cost you. It's all written in the IRS Instruction
booklet for years. You don't even have to go one step further
and read the IRS "Publication" series (at least I didn't need
to). Or if you're lazy, just run TurboTax. The AMT law didn't
just get added recently; it has existed for a long time. Don't
tell me that the instruction booklet is too hard for this
one-time Stanfurd professor to understand. If he wanted to
gamble, for his own greed, for a higher selling price under
well-explained rules, why should the public mourn for him ending
up with a lower selling price? If he wanted to gamble for a
charity, or if the AMT laws were added after he placed his bet,
that may be a different story. -- 0x1
\_ If you'd bothered to read the article, you'd know that it
wasn't the AMT that got to him, it was holding his stock and
losing his fortune that made him unhappy.
\_ If you'd bothered to read the article, you'd know that it was
AMT that got to him because without AMT his unsold stock would
still have had value instead of causing massive lifelong tax
fluctuates and is volatile. When a loan agent
calculates your net worth, stocks are included.
debt. Thank you for trying.
\_ There were people who exercised options and then could not
sell because of SEC regulations who got screwed. What about
them? --PeterM
\_ What about them? The SEC has those regulations to keep the
snake oil salesmen at bay. They sold snake oil. They lost.
\_ "They sold snake oil". They who? This was just some dumb
professor shmuck, not anyone who knew anything.
\_ Again, the SEC regulations were there before those people
exercised their options. Since they gambled at their own will
regulations, AMT laws, etc.
under those regulations, they should suffer the consequence.
-- 0x1
\_ as other people have said, if you are dealing with the amount
of money in stocks these people were dealing with and you DON'T
consult a specialist about all these sorts of traps you are
such a dumbass you don't deserve your money.
\_ while I might agree that such a person wouldn't deserve the
millions of dollars they think they're getting out of stocks,
I think it's silly to put them hundreds of thousands of dollars
into debt by taxing them on something they never really had.
\_ they did have it. They just didn't sell it when it was
worth something, because they wanted a bigger payoff.
Too bad. -tom
\_ Stock has no value until sold. Only then can you
calculate the gain. Taxing the difference between the
option value and the current price is ridiculous. The
market is floating, duh. There's no profit until sold.
If I buy 100 shares of Tomware (symbol: RED) at 10 and
options are no longer options. They are real stocks,
just like stocks people buy from the open market. AMT
does not tax on vested options, only exercised ones. When
someone gives you some stocks as a gift, you pay tax even
before you sell them because that's income. It's the same
idea here for exercising stock options. When you exercise
your options, the difference between the option price and
the stock's current price is income, so you pay tax even
before you sell the shares.
it climbs to 1000 the next day I have not made a profit
of 990 x 100 shares. Stay with your government day job.
Options shouldn't be treated any differently. There's
no other place in the tax code where one can get taxed
on unrealised profits.
\_ Technically, when you buy the options there is a sale.
The company sells you the shares at the option price.
Because there is a transaction, the feds want in. Its
wrong, but it is the law.
\_ Stocks have real value. It's just that the value
fluctuates and is volatile. When a real estate loan
agent calculates your net worth, stocks are included.
AMT does not tax the difference between the option
price and the current market price at the end of the
tax year. It taxes the difference between the option
price and the then-current market price at the time
of exercising the options. The difference between the
then-current price at time of exercise and the current
price at the end of tax year is unrealized profit,
agreed, and so you don't get taxed. But the
difference between the option price and the then-
current price at time of exercise is realized profit,
hence you get taxed. -- 0x1
\_ I can't agree more.
\_ While it may be true in most cases, I see a lot
of people who are utterly confused about 401ks,
current market price is income, so you pay tax even before
you sell the shares. -- 0x1
SPPs and things like that, and I am not talking
about old ladies but engineers and software people.
I think this AMT thing is too tricky and dangerous
for many.
\_ When my ex-company first went IPO, all the employees
were *required* to attend an in-house presentation
during work hours that explained stock options, SEC
regulations, AMT laws, etc. -- 0x1
\_ What's wrong with taxing the realized gain when they sell it,
like in stocks?
\_ That hides the income indefinitely. It's not appropriate
when options are being used in lieu of salary. -tom
\_ It isn't income until sold. Only then can one say what it is
worth, tax it, spend it, etc. I can't pay my mortgage or my
grocery bills with options, even vested options. Options are
not income or money or revenues or anything else of that
nature. I can't put them in a bank. I can't get interest on
them. Options are only the "option" to buy a share of stock
at a certain price. Nothing more. It's just a promise from
the company. This should be clear now. Options != income and
thus should not be taxed until converted to stock and sold.
In fact, since the company has "first rights" to buy them from
the employee, they in theory have no value at all until the
company has _allowed_ the employee to sell them to someone
else in the open market.
\_ Vested options are just "options", correct. But exercised
options are no longer options. They are converted to real
stocks, just like stocks people buy from the open market.
You can put them in a brokerage account, you get dividens
from the company when it pays dividens, and you own
a certain percentage of the company, AMT does not tax on
vested options, only exercised ones. When someone gives
you some stocks as a gift, you pay tax even before you
sell them because that's income. It's the same idea here
for exercising options. When you exercise your options,
the difference between the option price and the stock's
then-current market price at time of exercise is income,
so you pay tax even before you sell the shares. -- 0x1
\_ Question: If the stock price drops like a rock after
exercising the option, couldn't the person sell it
and claim a big capital loss, which will offset the
income tax incurred when the option is exercised?
If that is true, they didn't make anything on their
options, but wouldn't be taxed into a hole either.
So, what's the problem?
$90000, while these poor dumb people have to
\_ You can only claim a $3000 capital loss per yr.
When dealing with the feds the rule is "you can't
win."
\_ Capital loss can offset any amount of capital
gains right. Make it such that if it is
higher than capital gains, allow it to
offset any amount of income tax incurred
as a result of AMT. Seems like a reasonable
solution to me.
\_ Actually, you can get back AMT credits in
subsequent tax years after the year you pay
AMT, even if you are still holding the stocks.
(It might not be 100% of the AMT you've paid,
though.) It's all in the IRS Instruction
booklets. -- 0x1
\_ Yes, but 30 years * $3000 per year =
$90000, while depending on how dumb they
are, these poor fucked-up people have to
pay hundreds of thousands if not millions
of dollars in AMT taxes. |
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