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I was around when trading options as a market maker was declared unearned income
and subject to a 75% max. tax, so don't cry to me. If you worked hard and
earned the options, then it is earned income and the taxes should be paid. It
is part of your compensation, not a gift or grant and you are not a non-profit
organization. With all that education, how can the option babies cry ignorance
about the consequences of their actions? Is it unrealized profit when they go
borrow against it to buy a home, a Ferrari, or a European vacation home. Why
didn't they borrow against it to pay their taxes? It was their own personal
greed and not the government that created the problem and now they want the law
changed to bail them out. Isn't anyone responsible for the own actions
anymore? I guess that is the reason that the prisons are full. Why should one
group be held responsible for their actions and another not be. Are the options
babies a special category that should be allowed to let their greed be wonderful
and anyone else's be punishable. But then again everything is either the
governments fault or Allan Greenspans according to many. There is that old
corporate thought process, designation of blame is the secret to success and
corporate advancement.
John Hall wrote:
> Options are part of the compensation given to an individual for hard work
> and success. The companies determine who and how many options an individual
> gets not the individual. Most people who received them worked 12-14 hours a
> day 5-7 days a week. I was one of them. Most people who received options
> did not work hard because of the options in front of them, five years out I
> might add. These are people who for the most part have spent a minimum of 4
> years in college to get a degree and additional time in training or graduate
> programs. These people are not option babies.
>
> The problem is one of greed by our government who want taxes on non-existent
> income. The options are non-quals which are not taxed at time of exercise.
> The options given by most companies now do take out taxes at time of
> exercise. Once an individual purchases the stock from an options grant the
> taxable is the difference between the grant price and the current value of
> the stock on the date of exercise. Once the individual sells the stock
> gained from options exercised the taxes are adjusted to what the "real"
> profit or loss is. Most of the options from these companies are either at
> the money or under water now. A lot of the people who exercised options and
> did not sell at the height are under water from the exercise price.
>
> You should be pointing your finger where the problem lies with the Federal
> government, not the individual. Bottom line for me on this issue is a
> socialist tax system that wants to re-distribute wealth in this country to
> those who neither took the risk nor the time to get educated nor worked to
> make the money. A congress that is so greedy that they define un-realized
> gains as income. What's really interesting is that companies pay taxes on
> the options and anyone getting the options pays taxes on that same money.
> The governments double dipping.
>
> By-the-way Ira, if I follow your logic you should pay taxes each time a
> trade you are in shows a profit before you have closed out the trade. This
> is regardless of the final outcome of the trade. You can adjust the taxes
> after the trade is closed.
>
> "One of the option babies who isn't under water."
> John
>
> ----- Original Message -----
> From: "Ira Tunik" <irat@xxxxxxxxx>
> To: <realtraders@xxxxxxxxxxxxxxx>
> Sent: Saturday, June 23, 2001 7:42 AM
> Subject: Re: [RT] Tech workers upset that they owe taxes on underwater
> options
>
> > They couldn't even sell enough stock to cover the taxes. that is real
> greed
> > and now we are supposed to pay.
> >
> > Me wrote:
> >
> > > Driving the economy into recession and raising living costs to insane
> > > levels wasn't enough for the tech industry, now the option babies are
> > > upset because their stock options are underwater and they owe big
> > > taxes. Sheese. I know people who have gotten into this situation
> > > and it all occurred because they were greedy. They didn't sell their
> > > options at exercise time, instead choosing to hold onto the stock so
> > > they would pay less taxes down the road. Will Congress succumb and
> > > bail them out like AG has bailed out the big companies that made the
> > > wrong decisions?
> > >
> > > The Valley's Tax Revolt
> > > By Scott Harris
> > >
> > > Tech workers are taking a big tax hit on their stock options. Will
> > > Congress come to the rescue?
> > > http://www.thestandard.com/article/0,1902,27355,00.html?nl=int
> > >
> > > To unsubscribe from this group, send an email to:
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> > >
> > >
> > >
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> >
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> >
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> >
> >
> >
>
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>
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