Posted on 10/27/2009 11:27:46 AM PDT by antiRepublicrat
After King County Superior Court Judge Gregory Canova awarded Microsoft an $8.7 million judgment in a 2008 lawsuit involving unpaid software licenses, he might have been surprised to learn that Microsoft isn’t actually in the software licensing business in Washington – or at least that’s what it reports to the state Department of Revenue.
For tax purposes, Microsoft reports that it’s earned its estimated $143 billion in software licensing revenue in Nevada, where there is no licensing tax. However, for legal purposes, Microsoft executes its licensing contracts so they are governed by and rely on the protections of Washington law and its courts (some regional contracts are governed by the laws in Ireland or China).
When necessary, as in the case Microsoft Licensing GP v. TSR Silicon Resources, which lasted two years, Microsoft uses the resources of Washington courts to enforce its licensing contracts. It does this while simultaneously dodging the taxes it would normally pay for engaging in the software licensing business in Washington - the same taxes that fund the courts.
(Excerpt) Read more at blog.reifman.org ...
The problem with income taxes is that politicians will always accept bribes and give one company an advantage over another.
I knew that. Just as I’m sure there are numerous and sundry Trust Funds for their kids to avoid the inheritance tax. Not that there is anything wrong with their Foundation (other than the liberal stuff it promotes!) or the trust funds. It’s the hypocrisy that bothers me.
Based on what evidence exactly?
The empty words of a tax and spend loony left bomb thrower?
“The tax man does not like it when you use a shell game to hide income. “
The tax man knows exactly what to do IF they think tax laws have been broken. Hint: Throwing bombs on the internet is not part of it.
“It's quite obvious that the Nevada entity is a shell.”
Again, the IRS(who know our tax laws), know what action to take IF they think tax laws have been broken.
So far, all I am seeing is the empty rantings of a hard line left wing radical, faithfully repeated by a Microsoft hating Applebot, who is scared silly at the sheer superb quality of Windows 7, and is out to spread as much anti-Microsift FUD as he can, on Freerepublic.
“Why all the sudden the compassion for tax cheats? “
Now why don't YOU show me where the IRS actually said Microsoft has cheated on their taxes, eh?
” Did Rangle and Obama’s cabinet really change us that much”
Naaah.
But Steve Jobs, and Apple cheating on Apple stock option backdating, at the expense of hard working ordinary shareholders did.
He's what they call a "Microsoft millionaire." That's right, go ad hominem when the facts don't look good.
But Steve Jobs, and Apple cheating on Apple stock option backdating, at the expense of hard working ordinary shareholders did.
One: Jobs was judged to have done no wrong and to have not profited from the backdating.
Two: One person was found to have fudged paperwork to correct an oversight and Apple handed her over to the feds.
Three: The shareholders suffered no loss of value due to the backdating, as proven by a lawsuit over it getting thrown out due to the inability to show any damages.
Your knowledge of computer industry history really sucks.
Now if yo will just show me were the IRS says Microsoft hasn't paid taxes that they legally owe, then you can even begin to talk.
Until then, this bomb throwing article you posted, is simply yet another pathetic attempt at anti-Microsoft FUD, based on NOTHING, brought on by the the panic that Applebots are suffering everywhere, from the superb quality, and blistering sales of the Win 7 launch
It is perfectly legal, for company to incorporate in a tax friendly state in order to maximum return or least expense based on regulations and taxation.
This is not communist North Korea..not yet anyways.
Worth repeating here:
The IRS itself encourages every taxpayer to use every LEGAL means to reduce their tax bills.
Produce ANY evidence of illegal tax evasion by Microsoft or shut up already. And no, sheer inuendo won't do.
Steve jobs claimed he never really understood the implications of the options backdating because “he is not a financial guy”
Yeah right. The biggest control freak on the planet, loves money more than anyone I know, and he is not aware of implications of the stock option backdating in his own company?
If you believe that, I got an ice skiing slope in Florida to see ya.
Steve Jobs is not guilty like OJ Simpson is not guilty. He got away with it too.
Even Fortune magazine (as pro Apple as they come)was not buying it:
“The Apple iWash: Steve Jobs’s premature exoneration”
The second argument is: We don’t have to worry about whether Jobs was trying to backdate or springload options because “he did not . . . financially benefit from these grants.” Again, this is no defense. If a hypothetical CEO gave himself backdated options in a effort fraudulently to deceive shareholders and enrich himself, that attempt would be a completed crime regardless of whether the dot-com bubble subsequently burst before he could capitalize on the attempted fraud. (The bursting of the bubble did, in fact, wipe out the value of all Jobs’s options. Apple replaced them with 5 million shares of restricted stock, worth almost $75 million, in 2003.) And if a hypothetical CEO gave someone else backdated options, then it’s hard to believe that he really wasn’t benefiting financially–albeit indirectly. His company would have been benefiting–it was able to offer higher compensation to employees than its law-abiding competitors could–and anything that benefited the company would have indirectly enhanced the CEO’s compensation and the value of his stock.
The third claim is that we don’t have to worry about whether Jobs was trying to backdate or springload options because he didn’t “appreciate the accounting implications.” Well, that’s getting closer to a defense, but I still don’t think he’s there yet. None of us fully appreciated the accounting implications of awarding in-the-money options at that time; the rules were excruciatingly complex and everyone twisted themselves into pretzels to avoid ever having to grapple with them. The relevant question is whether Jobs understood that backdating was morally or legally wrong–and the filing doesn’t tell us the answer to that one.
Furthermore, even if Jobs says he didn’t understand that backdating was illegal or wrong, and even if we believe him, I’m still not sure that gets him out of the woods. Yes, ignorance of the law is a defense to some white-collar crimes (mainly tax offenses), but it’s not a defense to most others. (Look at Pattie Dunn, the former chairman of Hewlett-Packard (HPQ), now facing four state-law felonies for having conducted an investigation that two top in-house attorneys repeatedly kept assuring her was A-okay.)
To me, Friday’s filing does not look like the curtain closing on this particular play, but more like the curtain closing on Act I, Scene I.”
http://features.blogs.fortune.cnn.com/2007/01/02/the-apple-iwash-steve-jobss-premature-exoneration/
Marketwatch:
“In October 2006, Apple issued an unusual statement in which the company admitted that, while Jobs was aware of the backdating, he was unaware of the accounting implications.
.....
That position was undercut six months later when former Apple finance chief Anderson — who settled with the SEC — issued his own statement, in which he said he had warned Jobs specifically of the implications of backdating. See full story”
http://www.marketwatch.com/story/steve-jobs-haunted-by-backdating-scandal-again
Chortle!
“Fudged paperwork” and "oversight" by one person huh?
You Apple crazies just crack me up.
You are worse than 0bama’s White House propaganda machine.
Marketwatch:
Steve Jobs can't shake stigma of backdating
This week, another former confidante to Jobs came under the microscope of federal regulators. Ann Mather, who worked as chief financial officer of Pixar Animation Studios before then-chief executive Jobs dealt Pixar to Walt Disney Co, got the bad news this week. Mather, also a director at Google Inc., was notified that the staff of the Securities and Exchange Commission had recommended the agency bring civil action against her related to the backdating of stock options
The move came almost exactly a year after the SEC filed similar charges against former Apple CFO Fred Anderson and former general counsel Nancy Heinen. Anderson settled his case, but Heinen is still on the hook and expects to go to trial sometime next year. Mather, Anderson and Heinen, through their lawyers, have strenuously denied wrongdoing.
In other words, there seem to be an awful lot of people around Steve Jobs who have allegedly had problems linked to the backdating of stock options. I'm just saying.
.........................
But as yet another executive who was once close to Jobs comes under the backdating cloud, one has to wonder: Is Jobs as innocent as Apple Inc. and its board have repeatedly claimed? Or is the government afraid to go after one of the most respected leaders of American business?
http://www.marketwatch.com/story/steve-jobs-haunted-by-backdating-scandal-again"
Fudged paperwork by one employee huh? Will you excuse me while I laugh?
This is a heck of a lot more than “fudged paperwork” by one employee. I can count 3 people here alone, and the SEC is not talking about no "fudged paperwork" here.
Maybe you'd better read this:
The impact of the options backdating scandal on shareholders
http://www.sciencedirect.com/science?_ob=ArticleURL&_udi=B6V87-4V16627-1&_user=10&_rdoc=1&_fmt=&_orig=search&_sort=d&_docanchor=&view=c&_searchStrId=1067282904&_rerunOrigin=google&_acct=C000050221&_version=1&_urlVersion=0&_userid=10&md5=587c68309ac3aeb3782157d1393dbf0c
And this:
“Apple Execs Sued for Losses Related to Backdated Options”
http://www.cultofmac.com/apple-execs-sued-for-losses-related-to-backdated-options/2214
And this:
July 2, 2008 10:20 AM PDT
Jobs, Apple directors face new backdating suit
http://news.cnet.com/8301-13579_3-9982877-37.html
“Your knowledge of computer industry history really sucks.”
Yeah? Funny, I seem to know more about Apple's ILLEGAL stock option backdating than you do. Plus I have continued to clobber you with ease in every single topic have debated in this thread, including this very one about Apple's ILLEGAL stock options backdating.
1. Backdating was LEGAL and common practice in tech companies. Only the reporting and accounting requirements had changed, throwing many companies off.
2. The court ruled that nobody could prove any loss to shareholder value due to backdating.
3. Apple's investigation found two people who had fudged paperwork concerning the LEGAL backdating and turned them over to the SEC.
4. The SEC cleared Apple and Jobs of any wrongdoing.
Your claim of illegal reeks of libel.
That's because people who hate Apple, like you, keep bringing up a settled issue. You do realize this hurts shareholder value, right? Of course you do. How much is Microsoft paying you?
This was an industry-wide issue, with hundreds of companies caught up in it. Some of them were actually found to be abusing stock options. Some, like Microsoft, stopped doing it years ago, taking a $200 million charge to do it (where were the shareholder suits over that?).
And, yes, fudged paperwork due to an oversight. It's illegal to do that even when you're doing it about something that was itself perfectly legal. Basically, she cut corners instead of correcting the oversight the proper, and legal, way.
Sorry, your innuendo and libel are going nowhere. The courts and the SEC cleared Apple and Jobs. It ends there.
loves money more than anyone I know
Yep, he's really greedy for taking that $1 a year salary from Apple.
His compensation is almost completely tied up in the value of his companies. Stock options and grants are how he gets paid. He's so rich because he increased the value of his companies so much, not because he drew big salaries like most CEOs.
Funny, the article was written by a Microsoft millionaire.
It is perfectly legal, for company to incorporate in a tax friendly state in order to maximum return or least expense based on regulations and taxation.
Unless you're using a shell company to evade taxes in the state where the real operations are done and income is going. The article, which you probably have not read (hell, you don't even read your own posts) lays it out very well.
And that us relevant how?
Have you heard of Rob Glaser?
He was a Microsoft millionaire too.
He's spent the last 15 years doing everything he can to bring Microsoft down, including suing Microsoft in court several times.
“Unless you're using a shell company to evade taxes in the state where the real operations are done and income is going”
Now why don't you show me where the IRS says that?
I have REPEATEDLY asked you to show me ANY statement from the IRS saying Microsoft is illegally evading taxes, and you have equally REPEATEDLY refused to provide any such evidence. You are waffling worse than 0bama on Afghanistan. Your posts is Pure FUD.
‘nuff said.
It was done by a lot of greedy clowns in Silicon Valley, but it sure wasn't legal.
Broadcom cofounder Henry Nicholas faces up to 360 years in jail on charges of backdating options and distributing illegal drugs.
http://www.forbes.com/forbes/2009/1019/forbes-400-rich-list-09-broadcom-nicholas-after-the-fall.html
“Yep, he's really greedy for taking that $1 a year salary from Apple”
Which he more than made up for, by giving himself massive stock options.
“Stock options and grants are how he gets paid”
Stock options are legal. Backdating stock options to a previews date so you can make huge illegal profits at the expense of ordinary shareholders is NOT legal, which is what this is about.
Chortle!
Ummm.. I didn't write those articles.
Those 2 articles were from the Apple loving Fortune magazine, and from Marketwatch, which almost always shills for Apple.
One of the articles was written when the SEC brought up charges in May this year on the Apple stock options backdating scandal.
They are business publications. They SHOULD cover such a story, unless you are suggesting that Apple is above the law and Steve Jobs is The Messiah (0bama Junior), or that that Apple should get a special dispensation to break the law and not get it reported in the news?
“This was an industry-wide issue, with hundreds of companies caught up in it.”
Hundreds of murders are committed in New York City every year. That doesn't make killing someone legal does it?
” Some of them were actually found to be abusing stock options.”
Including Apple CEO, who settled with the SEC.
” Some, like Microsoft, stopped doing it years ago, taking a $200 million charge to do it (where were the shareholder suits over that?).”
ROFL!
Microsoft didn't do options backdating.
They merely stopped offering any stock options altogether, which happens to be very legal.
Way to try and change the topic and throw ineffective laughable bombs.
What more ya got?
So now we know you don't know anything about stock options or this case. Nicholas hid the backdating of stock options to make it look like they were granted on the earlier date. He purposely deceived shareholders for his own profit.
The practice as happened at most companies, including Apple, is to grant the options on the date they were approved and state that the starting date for calculating their value is on an earlier date. It is perfectly legal as long as it is an approved method of compensation at the company, as it was at Apple.
Apple's main problem came from a change in accounting rules that determined how the backdating is accounted for on the books. Many companies that used the legal backdating method of compensation were caught up in that.
Which he more than made up for, by giving himself massive stock options.
Impossible. The board grants the options.
Backdating stock options to a previews date so you can make huge illegal profits at the expense of ordinary shareholders is NOT legal,
Wrong again in the Apple case, as shown.
No fudged paperwork
Deliberate, pre meditated backdating of stock options by Apple execs in order to profit.
Former Apple finance chief Anderson — who settled with the SEC — issued his own statement, in which he said he had warned Jobs specifically of the implications of backdating.
http://www.marketwatch.com/story/former-apple-cfo-says-jobs-was-warned-of-options-dates
“Fudged paperwork” huh?
Don't make me laugh!
“Basically, she cut corners instead of correcting the oversight the proper, and legal, way”
Nope.
and currently 3 people have been charged by the SEC ( former Apple CFO Fred Anderson, former general counsel Nancy Heinen, and Ann Mather), so far, not just one woman. But hey, just keep ya head in the sand like an ostrich.
“Sorry, your innuendo and libel are going nowhere. The courts and the SEC cleared Apple and Jobs. It ends there”
You wish.
The SEC has brought new charges against Ann Mather on this same stock options back dating. That means they are still investigating the case, and were not happy with the answers that Apple gave them.
I know the charges brought by the SEC.
” Nicholas hid the backdating of stock options to make it look like they were granted on the earlier date. He purposely deceived shareholders for his own profit.
“
Which is exactly what Apple did, according to ex Apple CFO, Anderson (who settled with the SEC ..read pleaded guilty for a lower sentence/fine)— who said he had warned Jobs specifically of the implications of backdating.
http://www.marketwatch.com/story/former-apple-cfo-says-jobs-was-warned-of-options-dates
“Apple's main problem came from a change in accounting rules that determined how the backdating is accounted for on the books”
Keep telling yourself that.
They deliberately set out to cheat, and they were caught, and the SEC has already brought charges against 3 ex Apple execs on the matter.
“Impossible. The board grants the options.”
Jobs controls the Apple board. He has put his own creatures on the Apple board since he took over.
“Wrong again in the Apple case, as shown”
Apple's case has already led to THREE Apple execs charged by the SEC, with one guy having settled with the SEC, and the other 2 charges still ongoing.
Which were dismissed against Apple and Jobs due to no finding of wrongdoing. You keep forgetting that part.
who settled with the SEC ..read pleaded guilty for a lower sentence/fine
Actually, he admitted no wrongdoing.
Keep telling yourself that. They deliberately set out to cheat
Wrong. I'll try typing slowly for you:
Backdating stock options at Apple was perfectly legal and a common part of their compensation package.
Yes, a common part of their compensation package. Apple granted backdated stock options 6,500 times (15% of all granted) during the period in question. Jobs got two of them, later canceled. Where do you think the rest went? Spread about among hundreds or thousands of employees, of course.
As for those who got in trouble, they were busted for circumventing internal controls for Apple's backdating policy and lying to the outside auditors Apple hired at great expense (27,000 man hours, a million documents examined) to investigate the mess. Apple caught them and turned them over to the feds.
As far as the big backdated grant to Jobs, that was approved in August 01, but not finalized until December 01, but backdated to October 01 (which was actually forward-dated from the time of approval). The problem came when the guilty one decided to make up a board meeting on that October day to say they were approved on that day.
The basic fact: The board intended to give Jobs those options at the August price, which was about the same as the October price. The December price would have cheated Jobs out of a lot of money they intended to give him.
In any case, this was later canceled by the board, which instead gave Jobs five million shares (not options to exercise, flat-out gave them to him). Those shares were worth about $35 million at grant time, and are worth about a billion dollars now (except Jobs sold half in 2006). And you're complaining about $20 million that Jobs could have made off the backdating?
The facts remain against you. Jobs and Apple are squeaky-clean and did the right thing all the way through.
Which Apple CFO settled with the SEC(read pleaded guilty to save a trail, for a fine and no jail term).
Which the SEC is still psersuing charges against 2 more Apple execs obn the stock optiins backdating scandals.
“You keep forgetting that part”
You keep forgetting the ongoing charges against 2 Apple execs, and the Apple CFO “settling” with the SEC..
Read above.
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