carnegie

nubus said:

AppleInsider said:

It is unclear exactly why Apple wants to sell bonds and raise cash, especially since its Q2 2025 results revealed it had $28 billion in "cash and cash equivalents," along with other assets. 

Apple must borrow in the US as profits are cash is kept offshore to avoid contributing to the US. It has caused a significant financial leverage and it makes borrowing more expensive for Apple. The alternative would be to pay taxes in the US.

That's no longer how it works. Under the Tax Cuts and Jobs Act (2017) as-yet undistributed foreign earnings were deemed repatriated and potentially subject to U.S. taxation regardless of whether they were actually distributed to the U.S. parent company. Going forward such foreign earnings would generally no longer be taxed by the U.S. when they were distributed to the U.S. parent company (i.e. repatriated). In some circumstances a couple of new taxes, GILTI and BEATS, might apply. But those apply regardless of repatriation.

So the concept of repatriation no longer has the tax significance it used to. Indeed, if you read Apple's SEC filings you'll see that it no longer reports the amount of cash, cash equivalents and marketable securities held by foreign subsidiaries which would be subject to U.S. taxation if repatriated. It stopped reporting those numbers after the TCJA came into effect. It largely stopped mattering whether those funds were distributed to U.S. Apple.

vesalius said:

Some one needs to lecture Apple/Cook and the bad politics of evading ceo taxes. Apple and Tim offer opinions on a multitude of nonfinancial sociopolitical topics why not this one? 

In what way are they evading CEO taxes?

avon b7 said:

Cesar Battistini Maziero said:

Very fair, they developed an audience and a platform people trust, they deserve a cut. 

Every online store gets a cut from sales.

It's already bizarre that they can't control their own store.

Nobody controls their own store. Before you can even open one there are huge amounts of rules and regulations to deal with. 

On the face of it, this comment by Apple does not appear to be in the spirit of the rule but we'll have to see how it plays out. 

At the end of the day all of this is basically part of a bigger puzzle and no one knows what it's going to look like yet. 

I don't see where Apple's comment is contrary to the spirit of the Netherlands ACM's decision. Whether Apple could continue to collect a commission for, among other things, the use of its IP wasn't at issue. The summary of the decision doesn't even mention Apple's commission. Apple's commission isn't what the ACM concluded was problematic.

If the ACM meant to prevent Apple from collecting the commission, its failure in the summary to mention the commission and explain why it's problematic would seem conspicuous. But the reality is this decision isn't about the commission. Whether or not the Netherlands would like to prevent Apple from collecting that commission, it likely understands that it probably can't. Doing so would probably violate international intellectual property agreements.

AppleInsider said:

...

It was also reported that the three companies were due to file a new, joint status report by August 18, 2023. It's not clear now whether that happened on schedule, but according to Reuters, Caltech has now formally filed a "request for dismissal" of the case.

...

They did file that status report as well as several additional status reports between then and now.

spheric said:

radarthekat said:

mongobongo said:

carnegie said:

I suppose the U.S. government could again try to get involved, filing a complaint of some sort, since that's where the money that Ireland will collect will ultimately effectively be coming from. 

How is the money effectively coming from the US government and not from Apple?

Credit for foreign taxes paid.  US is party to many tax treaties that prevent double taxation.  Ergo, if Apple instead paid the US government when it repatriated a ton of overseas profits back when the US government gave businesses a favorable tax rate to do so, then Apple will get a tax credit on the $14b it now has to pay to Ireland.  This will reduce its US taxes in the next tax year or years (until the credit is fully utilized).  Thus it’s the US government that will take a hit for this decision. 

Why does Apple get a tax credit on the $14b it has to pay to Ireland? The money was not repatriated; it's in escrow. These $14b are tax payable on overseas profits, which were never taxable by the US gov't in the first place. These extra $14b in local taxes do not affect Apple's US-taxable income, AFAICS. 

Or am I missing something?

Under the Tax Cuts and Jobs Act of 2017 those kinds of earnings - retained post-1986 foreign earnings which hadn't been distributed to the parent (U.S.) company - were deemed repatriated. Apple was required to pay U.S. income taxes on those earnings but the new tax liability could be paid over a number of years. I think it will still be paying that liability for a few more years. Whether certain earnings were actually repatriated largely stopped mattering at that point and you'll notice, if you look through Apple's financial statements, that it stopped reporting about sums that hadn't been repatriated. 

mad102190 said:

So if he sold 990k shares at ~$106/share, where did the $35.8 million figure come from? The total value I'm calculating is over $100M. No way he paid over 70% in taxes, as these should be considered Long Term Capital Gains, and only taxed at a flat rate of 20%...

For tax purposes such RSUs are treated as ordinary income based on their market value when they vest (or when the awardee gains effective control over them). If the recipient keeps them any appreciation (of depreciation) from there is treated as capital gains (or loses). So Mr. Cook has to pay income taxes on the value of this stock award as though he was paid its value in cash.

As for where the $35.8 million figure comes from: Mr. Cook didn't sell 990k shares, he sold 334k shares. The other approximately 656k shares were withheld by Apple to satisfy  tax withholding requirements. Those approximately 656k shares represent about 52% of the shares, 1,260k, that vested for Mr. Cook on Wednesday. Of the remaining approximately 604k, he sold 334k.

So... Mr. Cook received around $136 million in stock on Wednesday. Around $71 million worth of it was withheld for tax purposes (though he may end up effectively paying a different amount). Then on Thursday and Friday around $36 million worth was sold (at a slight loss relative to the stock's valuation for tax purposes).