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How does that work for people who receive a large portion of their compensation in things like equity in a private company that is extremely hard to value? Wou
by rblatz 7y ago
How does that work for people who receive a large portion of their compensation in things like equity in a private company that is extremely hard to value?
Would these plans result in the proliferation of odd compensation schemes to get around these repayment plans?
- azhenley 7y agoI'm not exactly sure. These programs are still in there trial phase anyway. The one program that I looked into had a relatively low cap on it, like $60,000, so they only take a cut of the first 60k. Plus the majority of people (i.e., outside of engineering) don't get equity anyway.
- afarrell 7y agoCouldn't they just look at Adjusted Gross Income?
- SeanAppleby 7y agoCouldn't you just use income reported to the IRS? Then any odd payment scheme to get around repayment terms would necessarily be tax evasion, which is much more serious and lets you lean on the IRS for enforcement and legislation.
- Accujack 7y agoMany forms of what you call "tax evasion" are in fact legal in the US. Lots of very, very wealthy people have no "income" at all, which means they don't pay taxes. The problem is that "income" is narrowly defined (for a reason) so things like someone owning a large corporation which triples in value over a year making them a billionaire on paper don't even show up on taxes because officially that person hasn't "made" that money until they sell the corporation. Even when they do, it's taxed at a lower rate than "income" because it's a different "kind" of money.
- oarabbus_ 7y agoIt's based off salary, not equity.