January 18, 2018
Tax Reform Fueled Stock Boom?
Tax reform has been a hot topic of late, with new changes effective January 1 of this year (and still being phased in). With the changes now officially the “law,” corporate america seems to be celebrating – in the form of bonuses back to employees.
Hiding Under a Rock?
If you’re asking yourself “what tax reform?” see Barbara’s blogs on the topic:
Tax Reform: The Final Scorecard (December 19, 2017)
Tax Withholding in 2018 (December 21, 2017)
IRS Announces 2018 Withholding Rates (January 11, 2018)
Celebration Bonuses
Since the beginning of the year, several companies (Wal-Mart, JetBlue, AT&T, Bank of America and others) have announced that they would be giving cash bonuses to employees in celebration of the new tax landscape. This week Apple joined those ranks – but with a different twist. The company confirmed that most employees would be receiving an award of $2,500 worth of RSUs in the coming months. A memo to employees, described by Bloomberg, indicated that the awards would be given to both full-time and part-time employees across all departments (up through senior manager level).
Is this the beginning of a stock boom trend? Will other companies use their projected tax savings to fund employee stock awards? It will be interesting to see if Apple is just a stand-alone on this, or whether there will be a mini-boom of stock awards conceived by the new tax reality.
-Jennifer