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It’s hard to value a potential large liquidation. A market sell by Jeff Bezos of 40% of his Amazon stock to pay for income tax would destabilize the markets.
by naveen99 5y ago
It’s hard to value a potential large liquidation. A market sell by Jeff Bezos of 40% of his Amazon stock to pay for income tax would destabilize the markets. Also, if there was no tax advantage to holding stocks long term, the entire stock market would have been liquidated to zero in q1 of 2020. market volatility would certainly be much higher than it is now.
- paulpauper 5y agoIt does not have to be. All would have to do is transfer the shares to a separate entity and then borrow against them while hedging downside with options
- naveen99 5y agoBorrow and lever up to pay taxes while shorting your main (too concentrated) holding with long put options. What could go wrong ? The IRS would more likely end up allowing you to take depreciation against your securities like they do for real property (which is subject to property tax)
- boomboomsubban 5y agoIf the tax requirements were public, there would not be much destabilizing from executives yearly selling off an appropriate amount of stock.