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Google Founders Cut Salaries to $1
GeneralCern writes "MSNBC Reports that Google founders Larry Page and Sergey Brin, and CEO Eric Schmidt
all slashed their salaries to $1
last year. Since you do not have to pay FICA, Medicare, or income taxes on
the capital gains associated with stock sales, they stand to substantially decrease
their tax burden. Is this a breach of the company's "do no evil" mission
statement, or just an example of people who love their jobs so much they don't
need to be paid to go to work?" Update: 04/09 13:11 GMT by H :And don't trust the above tax lines; it all depends on how sales are done; moreover when you are worth X amount with stock, I suspect the "tax burden" of what is, relatively speaking, a salary that's small compared to networth isn't a substantial impact. Sorry folks; poor story.
Sergey Brin is, according to Forbes, already worth $7.2B. Wouldn't it be great to be so incredibly rich that you did'nt have to worry about personal income ever again?
Anyway, this is PR that's probably worth way more than the salary itself. Steve Jobs does the same thing, IIRC.
One *always* pays taxes on capitals gains from stock sales. Has nothing to do with salary.
Is it me or does the article poster spin from the left and ignore facts ?
Apple has been evil for a few years.
Not a Twitter sockpuppet... but I wish I was.
Yes we have minimum wage. The employee needs to complain, afaik. http://www.dol.gov/dol/topic/wages/minimumwage.htm
My Systems
The article poster stated that you don't pay FICA tax (another word for social security tax), medicare tax or income tax on stock appreciations. That is completely true and all of those are different than capital gains tax - which is what they would pay based on appreciation in their stock price.
I believe the article poster's premise is that they're becoming ungodly rich because of stock appreciation and that they cut their income to $1 per year to avoid contributing to society in the way that the rest of us do.
If I had to pick a reason, I'd say it's more of a PR stunt to make the Google founders appear frugal (or froogle if you like) and make it seem like the money hasn't gone to their head. Many other CEO-types have done this (including Steve Jobs).
I'm a big tall mofo.
"Does the US have a minumum wage?"
Yes, but that's for hourly wages, not salaries.
i imagine that patent would have expired by now, so that's kinda a moot point :)
ashridah
Actually, it is has nothing to do with salary versus wages. It has do with whether the job description is exempt or non-exempt. Most managerial positions are exempt (meaning minimum wage/overtime etc. don't apply). Just because your paid by salary doesn't mean your not entitled under the law to overtime. Lots of white collar employees are incorrectly considered exempt by their employers. Unfortunately for Slashdot, sys admins by definition are non-exempt.
Also - it is stupid to say that accepting one dollar is a tax avoidance scheme. Earning less is always and option but not a smart way to lower your tax bill. Refusing to accept a salary because 37% of it (or whatever the top rate is) will go to the IRS is sort of silly if you are trying to maximize your after tax salary. After all 63% of it (minus state income tax) is still yours. You have more not less by accepting the salary. I'd fire my accountant for coming up with a tax strategy that resulted in me having less money.