|
#2
11-09-2005, 04:57 PM
| |||
| |||
 Re: wages versus stock redemption "Steve Finn" <ironheadjones[at]verizon.net> wrote: - quote - > Ted" <Ted[at]ixmil.com> wrote:
No, they propose paying me less than they would if they did> > A company in which I am an minority owner owes me severance > > pay. They are proposing to redeem my stock at an above fair > > price if I will forgo the severance pay. It will work out > > even for me. I suppose they have their reasons. > It seems to me it works out better for you. Long term > capital gain on the stock redemption versus ordinary income > on the severance payout. The section 302 tests seem to be > met in this case. it properly, and letting the reduction in taxes make up the difference. I googled on 302 tests and didn't come up with much. Whats that about? << ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== > |
|
#1
11-09-2005, 04:01 AM
| |||
| |||
| Re: wages versus stock redemption Ted" <Ted[at]ixmil.com> wrote: - quote - > A company in which I am an minority owner owes me severance
It seems to me it works out better for you. Long term> pay. They are proposing to redeem my stock at an above fair > price if I will forgo the severance pay. It will work out > even for me. I suppose they have their reasons. capital gain on the stock redemption versus ordinary income on the severance payout. The section 302 tests seem to be met in this case. << ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== > |
|
11-09-2005, 04:01 AM
| |||
| |||
| Re: wages versus stock redemption Ted <Ted[at]ixmil.com> wrote: - quote - > A company in which I am an minority owner owes me severance
Does it work out even for you before or after taxes? The> pay. They are proposing to redeem my stock at an above fair > price if I will forgo the severance pay. It will work out > even for me. I suppose they have their reasons. > Would this be acceptable to the IRS? I know the IRS will > claim that payments to owners are actually dividends rather > than wages; so it is hard to see them complaining about what > is essentially the opposite. And if it is not acceptable, > would they go after the company or me? Last thing in the > world I need is tax problems. stock sale is capital gains (long-term?). The severance pay would be deductible by the company. Seth << ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== > |
|
#-1
11-04-2005, 03:50 AM
| |||
| |||
| wages versus stock redemption A company in which I am an minority owner owes me severance pay. They are proposing to redeem my stock at an above fair price if I will forgo the severance pay. It will work out even for me. I suppose they have their reasons. Would this be acceptable to the IRS? I know the IRS will claim that payments to owners are actually dividends rather than wages; so it is hard to see them complaining about what is essentially the opposite. And if it is not acceptable, would they go after the company or me? Last thing in the world I need is tax problems. << ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2005) - All rights reserved. > << ================================================== ===== > |
| Tags |
| redemption, stock, versus, wages |
Similar Threads | ||||
| Thread | Forum | Replies | Last Post | |
| redemption fees vasicrj@yahoo.com: How should I record redemption fees? Remove shares? sell? how do you record these transactions? | Microsoft Money | 3 | 01-10-2007 07:06 PM | |
| MUTUAL FUND REDEMPTION atlantic965: I have $4000 saved in my Mutual Fund which was rolled over from a 401k from my former employer. I need to withdraw $1000 to pay for some dental... | Taxes | 10 | 01-12-2005 10:15 PM | |
| ETF redemption tax consequences barno: Question, I purchased a significant position in an ETF (DIA) about 18 months ago as a temporary position. Anyway, I now have a significant... | Taxes | 3 | 07-31-2004 05:32 AM | |
| Disproportionate redemption question LadyAccountant: Brenda owns 600 shares of Eagle Corporation stock at a time when Eagle has 1000 shares of stock outstanding. The remaining shreholders are... | Taxes | 7 | 07-21-2004 05:39 AM | |
| Thread Tools | |
| Display Modes | |
| |
Linear Mode
