Apple CEO Tim Cook receives 255,000 shares of Apple stock
Apple CEO Tim Cook has received more than 255,000 shares of Apple stock as part of a new compensation package that will run through 2026.
Credit: Apple
Back in August, Cook received more than 5 million shares of Apple stock and sold them for more than $750 million. The stock transfer was the final part of a compensation package that Cook received when he became CEO of Apple in 2011.
On Sunday, Cook received 255,000 shares of Apple stock, according to a filing with the Securities and Exchange Commission posted to Apple's website on Sept. 28. By a rough estimate, the stocks are worth about $36.51 million.
In September 2020, the Apple chief executive was awarded his largest stock grant since 2011. The stock awards are meant to incentivize continued work at the company through 2025, and could see Cook receive more than 1 million shares by 2025.
The majority of Cook's compensation is in the form of restricted stock units. However, Cook still receives a salary and an annual bonus in addition to the shares.
Since Cook became Apple's chief executive in 2011, the Cupertino tech giant's share price has risen more than 1,100%.
Back in 2015, Cook revealed that he plans to donate the vast majority of his wealth to charity before he dies. The chief executive also regularly donates stocks to unnamed charities, most recently in August 2021.
Update September 29, 12:51 PM Eastern Time: A previous version of this story misreported the number of shares that Cook received. AppleInsider apologizes for the error.
Read on AppleInsider
Credit: Apple
Back in August, Cook received more than 5 million shares of Apple stock and sold them for more than $750 million. The stock transfer was the final part of a compensation package that Cook received when he became CEO of Apple in 2011.
On Sunday, Cook received 255,000 shares of Apple stock, according to a filing with the Securities and Exchange Commission posted to Apple's website on Sept. 28. By a rough estimate, the stocks are worth about $36.51 million.
In September 2020, the Apple chief executive was awarded his largest stock grant since 2011. The stock awards are meant to incentivize continued work at the company through 2025, and could see Cook receive more than 1 million shares by 2025.
The majority of Cook's compensation is in the form of restricted stock units. However, Cook still receives a salary and an annual bonus in addition to the shares.
Since Cook became Apple's chief executive in 2011, the Cupertino tech giant's share price has risen more than 1,100%.
Back in 2015, Cook revealed that he plans to donate the vast majority of his wealth to charity before he dies. The chief executive also regularly donates stocks to unnamed charities, most recently in August 2021.
Update September 29, 12:51 PM Eastern Time: A previous version of this story misreported the number of shares that Cook received. AppleInsider apologizes for the error.
Read on AppleInsider
Comments
The salary Mr. Cook receives this year will be taxed as income for this year. The salary he receives next year will be taxed as income for next year. The same is true of equity compensation. He'll receive these shares in 2024, 2025, and 2026 if he's still employed by Apple and if, for some of them, certain performance targets are met. That's when he'll incur income tax liability for them - based on their value when he receives them. That doesn't representing avoiding taxes, it's how income taxes work - for most everyone, not just executives or those compensated through equity.
As for charitable donations... yes, people can sometimes avoid taxes on money (or value) they donate. But that's true whether they're receiving compensation in the form of equity or in cash. For income tax purposes, these equity awards are treated as though the recipient was paid cash in an amount equal to the value of the shares they receive on the day they receive them.
Yes, he likely won't be avoiding taxation of this compensation when he actually gets it. But I've talked to a number of people who think executives are paid through these kinds of awards because there are big tax advantages (for them) for this kind of compensation as opposed to being paid cash.
So why not a private foundation instead? A foundation would have to use part of the fund every year to maintain its tax status. A donor-assisted fund does not.
Much-loved by big tech CEO's and their families or partners. If anyone is curious what Donor-Advised funds are, how they work, and why some people might see them as a legal tax dodge for the ultra-wealthy...
https://www.investopedia.com/articles/managing-wealth/080216/donoradvised-funds-benefits-and-drawbacks.asp
https://www.washingtonpost.com/lifestyle/style/zombie-philanthropy-the-rich-have-stashed-billions-in-donor-advised-charities--but-its-not-reaching-those-in-need/2020/06/23/6a1b397a-af3a-11ea-856d-5054296735e5_story.html
Depends on his vesting schedule how long he can delay payment. https://www.investopedia.com/articles/tax/09/restricted-stock-tax.asp The option to donate as of yet untaxed shares that have increased in value on paper also offers more tax advantages than donating already taxed salary. Can structure/choose to take less actual monetary salary in the years of RSU vesting decreasing other taxable income for that year. No such luck for anyone with a w2 income.
Just exactly where did you get the idea that Cook is "donating" some of his RSU, before they are vested? The article mentioned that Cook donated a significant amount of the RSU that was vested and he received earlier this year. No where did the article mention or even implied that he has donated any of the 255K RSU he just received. or even able to donate RSU before they are vested. To the IRS, those 255K shares are worthless, until vested. Which is why no taxes are due, until they are vested.
Or are you also going to claim that Cook is evading taxes on his newly award 255K RSU because he doesn't have to pay taxes on it, at the time they were awarded to him? If so, then you need to do some research on RSU and why the "R" stands for "restricted".
I think you are confusing this with being awarded so many shares of a company stock at a certain share price, but the person can not sell those shares until after a certain period of time. In these cases, the person has to pay the taxes on the value of those shares when it was awarded, as ordinary income. And then, any increase of value of those shares as capital gains (either long term or short term depending on the length of time after being awarded and selling.) Any loss of value would result in a refund on the taxes that were already paid for those shares. These type of stocks or option awards are being done away with, as they can be a headache, accounting and tax wise, not only for the company but also the person receiving the award.