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Pastimes : ASK Vendit Off Topic Questions -- Ignore unavailable to you. Want to Upgrade?

To: Kenneth E. Phillipps who wrote (12241)	5/10/2000 1:24:00 AM
From: DOUG H	Respond to of 19374

What do you think about not treating payroll expense on stock options as a non-expense item? Bloomberg reported today they do not include this item. Kenneth, If I may butt in and ask, are payroll taxes collected on option transactions? I don't know. And if they are and are'nt expensed, where do they show up in the qtrly report? They must be accountted for somewhere.

To: Kenneth E. Phillipps who wrote (12241)	5/10/2000 6:31:00 AM
From: Vendit™	Respond to of 19374

Kenneth Just to be clear Im a technical trader and so I honestly dont pay much if any attention to the fundamentals of a company as much as I do their technical health. To the question of payroll taxes of stock options I dont see a clear cut answer but I do have some thoughts for your consideration. Exercised options are the purchase of cheap company owned shares of the company by the employee which would be considered a compensation expense to the company which is also a tax deduction to the company which off sets at least part of any payroll tax expense but Im not sure there would even be one. Hence a probable wash. Most of the monies or profits that are actually taxable are not money which is generated by the employer but that is generated by the stock market which in turn would be considered a capital gains tax. I believe that the employee is responsible for his or her own capital gains taxes and not the employer. biz.yahoo.com biz.yahoo.com What you dont see in the above links is that the options may have been purchased at $3 per share as an example which I see as a very low tax exposure to the employer. Their are more qualified people to answer this question than I who post on this thread and I welcome any additions to or corrections to my explanation. All IMO Reid