Apple COO Tim Cook awarded $22 million bonus
Apple said Friday that Chief Operating Office Tim Cook was awarded nearly 22 million in stock- and cash-based compensation for his performance running the company during Steve Jobs' absence last year.
In a filing with the Securities and Exchange Commission, the iPhone maker said its Board of Directors unanimously approved the recommendation by Jobs to award Cook a one-time discretionary bonus of $5,000,000 in addition to 75,000 restricted stock units "in recognition of his outstanding performance in assuming the day-to-day operations of the company" when Jobs was on medical leave of absence.
Cook assumed the role of interim Apple CEO from January to June of 2009 so that Jobs could recover from liver transplant surgery. During that time, he oversaw the launch of several key products, most notably the iPhone 3GS.
At today's market value, Cook's 75,000 restricted stock units are worth $16,995,000, bringing the total current value of his compensation bonus to roughly $21,995,000. Fifty percent of the restricted stock units are scheduled to vest on each of March 10, 2011 and March 10, 2012, subject to Cook's continued employment with the company, Apple said.
The move underscores how valuable Apple considers Cook to its continued success. He was first lured to the company by Jobs in 1998 and since then has emerged as one of the stars of the Apple's management team, making him the the subject of overtures from some of the industry's biggest names, including Dell and Motorola.
Tim Cook delivers the State of the Mac address in Cupertino during October 2008.
It's widely expressed amongst Apple circles that Cook has long been groomed to succeed Jobs in leading the company should the co-founder ever have to step down. For more on Cook, see AppleInsider's recent profile.
In a filing with the Securities and Exchange Commission, the iPhone maker said its Board of Directors unanimously approved the recommendation by Jobs to award Cook a one-time discretionary bonus of $5,000,000 in addition to 75,000 restricted stock units "in recognition of his outstanding performance in assuming the day-to-day operations of the company" when Jobs was on medical leave of absence.
Cook assumed the role of interim Apple CEO from January to June of 2009 so that Jobs could recover from liver transplant surgery. During that time, he oversaw the launch of several key products, most notably the iPhone 3GS.
At today's market value, Cook's 75,000 restricted stock units are worth $16,995,000, bringing the total current value of his compensation bonus to roughly $21,995,000. Fifty percent of the restricted stock units are scheduled to vest on each of March 10, 2011 and March 10, 2012, subject to Cook's continued employment with the company, Apple said.
The move underscores how valuable Apple considers Cook to its continued success. He was first lured to the company by Jobs in 1998 and since then has emerged as one of the stars of the Apple's management team, making him the the subject of overtures from some of the industry's biggest names, including Dell and Motorola.
Tim Cook delivers the State of the Mac address in Cupertino during October 2008.
It's widely expressed amongst Apple circles that Cook has long been groomed to succeed Jobs in leading the company should the co-founder ever have to step down. For more on Cook, see AppleInsider's recent profile.
Comments
He seems confident enough in my eyes to be able to one day take over from Papa Steve one day in the future, Given a few more years of grooming to fit the Jobs mould. (i.e. he hasn't quite relaxed enough to go the full turtle neck but he's getting there
yet probably complain and lobby against even the slightest increase his tax rate.
You have nothing to back that claim up with. Don't gripe about someone that you don't even know's personality, he did a good job and I as a shareholder would like to see him stick around.
You have nothing to back that claim up with. Don't gripe about someone that you don't even know's personality, he did a good job and I as a shareholder would like to see him stick around.
And you have nothing to back up your claim that he wouldn't. Sure he did a good job, but any change in tax policy would have nothing to do with whether he sticks around, so I don't know why you brought that up.
It really wasn't any sort of attack on Cook personally, just the injustice and inequality rampant in America. The richest state in the richest country has schools where some students don't have desks. You don't think there's anything wrong with that?
And thanks to American tax laws, he'll pay much less of a percentage of his income than teachers (thanks to Bush tax cuts and capital gains codes), yet probably complain and lobby against even the slightest increase his tax rate.
You need to get informed and do some research. Rich people pay the vast majority of the taxes in this country, while there are millions of leeches sucking off the rest of us that actually work. You fail.
And you have nothing to back up your claim that he wouldn't. Sure he did a good job, but any change in tax policy would have nothing to do with whether he sticks around, so I don't know why you brought that up.
It really wasn't any sort of attack on Cook personally, just the injustice and inequality rampant in America. The richest state in the richest country has schools where some students don't have desks. You don't think there's anything wrong with that?
You're totally right. Everyone's income needs to be exactly the same as the next person's. We need REAL equality!
May 4, 2009
The Rich Pay More Taxes: Top 20 Percent Pay Record Share of Income Taxes
by Curtis S. Dubay
WebMemo #2420
Since the passage of the 2001 and 2003 tax cuts, critics have claimed incessantly that they disproportionately benefited the rich while burdening the poor. Now that the data is in, these claims have been shown to be unquestionably false.
Squeezing the Wealthy Even More
According to a report issued by the Congressional Budget Office (CBO), the tax cuts significantly increased the share of federal income taxes paid by the highest-earning 20 percent of households compared to their levels in 2000, President Clinton's final year in office.
In 2006, the latest available year from CBO, the top 20 percent of income earners paid 86.3 percent of all federal income taxes, an all-time high.[1] This is an increase of over 6 percent from 2000, when the top 20 percent paid 81.2 percent. During the same period, the bottom four quintiles all saw their share of the federal income tax burden fall sharply:
* The bottom 20 percent of income earners' share of federal income taxes fell from -1.6 percent in 2000 to -2.8 percent in 2006;
* The next 20 percent's share declined from 1.1 percent to -0.8 percent;
* The middle quintile's share dropped from 5.7 percent to 4.4 percent; and
* The fourth quintile's share decreased from 13.5 percent to 12.9 percent.
Each of these four quintiles' shares was an all-time low.
2001 and 2003 Tax Cuts Removed Low-Income Earners from Roles
The 2001 and 2003 tax cuts removed millions of taxpayers from the federal income tax rolls, leaving only those at the top to pay the bill. They lowered every federal income tax rate and created a new 10 percent bracket to further reduce taxes for low-income earners.
While these tax rate cuts lowered taxes for all taxpayers, low-income earners got the biggest cut. In addition to these rate cuts, the 2001 and 2003 tax cuts expanded the refundable Child Tax Credit from $500 per child to $1,000 per child. The combination of lower tax rates and an expanded Child Tax Credit meant many low-income taxpayers no longer paid any federal income taxes.
Was Greater Income the Cause?
Critics counter that the increase in tax shares for high-earners was due to income increases at the top of the income spectrum. But a closer look at the data shows this just is not the case.
The top 20 percent of earners saw their share of pre-tax income rise from 54.8 percent to 55.7 percent, from 2000 to 2006. During that same period, their share of federal income taxes increased from 81.2 percent to 86.3 percent.
The modest increase in incomes is not large enough to explain the large increase in the share of income taxes paid by the top 20 percent. Rather, the removal of substantial numbers of low-income taxpayers from the federal income tax rolls is the real culprit.
Refundable Credits Redistribute Income
The bottom 40 percent of income earners actually paid a negative share of federal income taxes in 2006. In other words, these taxpayers are actually paid money through the tax code. This happens through refundable credits like the Child Tax Credit and the Earned Income Tax Credit, which result in "refunds" when they are greater than the taxpayer's total income tax liability.
For instance, if a family with one child has an income tax liability of $300, it can claim the Child Tax Credit, which wipes out their tax liability, and still receive $700 from the IRS for the remainder of the $1,000 credit. On April 15, not only do the bottom 40 percent of all taxpayers pay no taxes, but they actually receive additional income from the IRS.
Refundable credits redistribute income from the top 20 percent of earners to the remaining tax filers, with the bottom 20 percent the prime beneficiaries. The bottom quintile's share of income, measured after taxes, actually increased a whopping 17 percent compared to its pre-tax levels because of the income they got from refundable credits. Comparing shares of income before taxes are paid to after, only the top quintile saw their share of income decline.
Obama's Tax Policies Widen the Gap
President Obama's tax policies would cause federal income taxes paid by the top 20 percent to increase and the shares of the remaining 80 percent to decrease even further. These policies include those passed as part of the stimulus legislation and those included in the President's Budget Blueprint.
The stimulus created the Making Work Pay Credit[2] and expanded the Child Tax Credit and Earned Income Tax Credit. These refundable credits will knock even more taxpayers from the federal income tax rolls and send more money to low-income taxpayers.[3] With fewer low- and middle-income taxpayers paying federal income taxes, the burden will shift even further in the direction of top earners.
President Obama also proposed in his Budget Blueprint to increase income taxes on those making over $250,000 by increasing their tax rates on investment income and reducing the amount they could deduct.[4] This would dramatically increase the share of taxes paid by the top 20 percent while the remaining 80 percent of earners would not pay higher taxes as a result of these proposed tax hikes.
Stop Shifting Burden to Top 20 Percent
To stop the shifting of the tax burden to a dwindling number of taxpayers, Congress should:
* Make the 2001 and 2003 tax cuts permanent for all taxpayers, not just those making under $250,000. This would slow the shifting of the burden to the top 20 percent.
* Stop creating and expanding refundable credits. Welfare spending and subsidies to low-income earners should be done through traditional spending programs, not hidden in the tax code. This would stop a growing portion of the population from being removed from the tax rolls.
* Cut top tax rates to return the shares of income taxes paid by each quintile to their more-sustainable 2000 levels.
On Dangerous Ground
The shifting of the tax burden to a small segment of high-income taxpayers is economically dangerous. The beneficiaries of government services are increasingly those who share little or none of the tax burden to pay for them. As they become more numerous, they put more pressure on Congress for more services. Meanwhile, those who bear most of the burden are being squeezed even more, shrinking their number. The result is a growing group of government beneficiaries clamoring for more of a shrinking group's wealth. Congress should put an end to this practice.
Curtis S. Dubay is a Senior Analyst in Tax Policy in the Thomas A. Roe Institute for Economic Policy Studies at The Heritage Foundation.
[1]Unless otherwise noted, all data come from Congressional Budget Office, "Historical Effective Federal Tax Rates: 1979 to 2006" April 2009, at http://www.cbo.gov/publications/coll...all_tables.pdf (April 23, 2009).
[2]Curtis S. Dubay, "'Making Work Pay Credit' Will Not Stimulate the Economy," Heritage Foundation WebMemo No. 2240, January 26, 2009, at http://www.heritage.org/Research/Taxes/wm2240.cfm.
[3]Curtis S. Dubay, "Obama's Stimulus Has "Spread the Wealth Around': Are Tax Hikes Next" Heritage Foundation WebMemo No. 2354, March 23, 2009, at http://www.heritage.org/Research/Economy/wm2354.cfm.
[4]U.S. Office of Management and Budget, A New Era of Responsibility: Renewing America's Promise (Washington, D.C.: U.S. Government Printing Office, 2009), p. 123, Table S-6, at http://www.whitehouse.gov/omb/assets
/fy2010_new_era/A_New_Era_of_Responsibility2.pdf (April 23, 2009).
It's widely expressed amongst Apple circles that Cook has long been groomed to succeed Jobs in leading the company should the co-founder ever have to step down.
When did Steve Jobs invent immortality?
And you have nothing to back up your claim that he wouldn't. Sure he did a good job, but any change in tax policy would have nothing to do with whether he sticks around, so I don't know why you brought that up.
It really wasn't any sort of attack on Cook personally, just the injustice and inequality rampant in America. The richest state in the richest country has schools where some students don't have desks. You don't think there's anything wrong with that?
WTF has that got to do with a bonus paid for performance much less Tim Cook? I think I smell a troll!
And thanks to American tax laws, he'll pay much less of a percentage of his income than teachers (thanks to Bush tax cuts and capital gains codes), yet probably complain and lobby against even the slightest increase his tax rate.
Everyone, please forgive stonefree's ignorance. You see, he went to public school and was taught by those teachers.
-kpluck
And you have nothing to back up your claim that he wouldn't. Sure he did a good job, but any change in tax policy would have nothing to do with whether he sticks around, so I don't know why you brought that up.
It really wasn't any sort of attack on Cook personally, just the injustice and inequality rampant in America. The richest state in the richest country has schools where some students don't have desks. You don't think there's anything wrong with that?
And you think that paying Cook less, or taxing him more, or taxing the teachers less will solve the problems of California kids not having desks?
If it was that simple, it would have happened by now.
http://www.heritage.org/research/taxes/wm2420.cfm
May 4, 2009
The Rich Pay More Taxes: Top 20 Percent Pay Record Share of Income Taxes
by Curtis S. Dubay
And ya know, I'm OK with that.
And you think that paying Cook less, or taxing him more, or taxing the teachers less will solve the problems of California kids not having desks?
If it was that simple, it would have happened by now.
I didn't say teachers should be taxed less. But, yes taxing Cook and all the other executives more would definitely help schools. How wouldn't it?
Saying if it was that simple it would have happened is the height of ignorance. Politicians don't tax the rich because that's who pays for them to get elected to office.
For a good breakdown of the ever widening disparity, see http://mobile.salon.com/opinion/cona...400/index.html
Quote = "According to David Cay Johnston, America's premier tax journalist, newly released IRS data shows that the country's very wealthiest citizens -- the top 400 -- marked enormous income gains while paying less and less in taxes."
There's a reason Jobs, Larry and Sergey (Google) , and many other executives get most of their pay, or in some cases all of it, through means other than salary - capital gains are taxed substantially less.
I didn't say teachers should be taxed less. But, yes taxing Cook and all the other executives more would definitely help schools. How wouldn't it?
Saying if it was that simple it would have happened is the height of ignorance. Politicians don't tax the rich because that's who pays for them to get elected to office.
For a good breakdown of the ever widening disparity, see http://mobile.salon.com/opinion/cona...400/index.html
Quote = "According to David Cay Johnston, America's premier tax journalist, newly released IRS data shows that the country's very wealthiest citizens -- the top 400 -- marked enormous income gains while paying less and less in taxes."
There's a reason Jobs, Larry and Sergey (Google) , and many other executives get most of their pay, or in some cases all of it, through means other than salary - capital gains are taxed substantially less.
DC has the most well-funded, yet poorest performing schools in the nation. Throwing money at schools doesn't make them work. Neither does punishing those who do well.
I didn't say teachers should be taxed less. But, yes taxing Cook and all the other executives more would definitely help schools. How wouldn't it?
They'll leave. You'll have neither the rich nor the taxes, and still have no desks for those kids. Economics 101. Learn.
CA's problems are too darned entrenched to be solved by stupid, value-destroying, short-term fixes like these. You are already the highest-taxed state in the country (or at least close). Your worst nightmare would be if Silicon Valley decides to pack its bags (as Hollywood already has, and left for places like Vancouver).