[startupcfo]

On page 4 of the Entity Tax book, it states:

THE DEDUCTION FOR COMPENSATION PAID RESPECT TO A COVERED EMPLOYEE OF A PUBLICLY HELD CORPORATION IS LIMITED TO NO MORE THAN $1 MILLION PER YEAR.

That can’t be right – Apple’s (perhaps the largest publicly traded company at the moment) CEO Tim Cook made 2M salary and 8M bonus, which is reasonable given his contribution, experience, and responsibilities.

You’re telling me that Apple can only deduct $1M of his $10M pay as an ordinary and necessary expense?

BEC - 87 | 02/28
REG - 70 | 06/10, REMATCH | 08/30
AUD - XX | 09/10
FAR - XX | 12/10

[Missy]

They simply call his salary “performance based” to get around it. https://www.propublica.org/article/remember-that-ceo-pay-cap-even-less-effective-than-we-knew

Licensed Massachusetts Non Reporting CPA since 2012
Finance/Admin/HR Manager

[Author]

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