The Jewish Home n
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Life Coach
Your Money Allan J. Rolnick CPA
Rivki D. Rosenwald Esq., CLC, SDS
#Windfall
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sychologists agree that the ability to concentrate is key to achieving our goals. But today’s high-tech world is full of distractions, from thousands of cable TV channels to millions of internet sites, with smartphones constantly within reach. Some experts say our attention span is actually shrinking. So should it be any surprise that Americans have fallen in love with Twitter, the online social networking and “microblogging” site that lets users send and read “tweets” limited to no more than 140 characters? Twitter attracted confusion (and no small amount of scorn) when it debuted in 2006 — co-founder Jack Dorsey admitted that the service is “a short burst of inconsequential information.” But there are now more than 200 million “monthly active users” posting more than 500 million tweets per day. Twitter’s ubiquitous “hashtag,” the pound sign (#) that denotes keywords, appears everywhere, including at the Oscars, the Super Bowl, and the floor of the U.S. Senate. Twitter still doesn’t make any money. But that didn’t stop them from going public last week. On Thursday, Twitter issued 70 million shares at $26 each. The price nearly doubled in early trading before closing at $41.65 on Friday. And it made a lot of people rich. Co-founders Evan Williams and Jack Dorsey are billionaires. CEO Dick Costello, whose 2012 cash salary was just $200,000, is worth $300 million. All told, about 1,600 investors and employees became millionaires last week. (If you planned on buying a house or a Porsche in Silicon Valley, plan on standing in line and paying more!) What does that all mean for our friends at the IRS? It means a #windfall, that’s what! Twitter has granted non-executive employees over 92 million “restricted stock units” which will essentially
convert to stock over the next several years. Employees will owe regular income tax of up to 39.6% plus Medicare tax of up to 3.8% on the value of those shares. They’ll owe an average of $420,000 each in federal tax! Uncle Sam won’t be the only taxman with his hand out. The state of California can conservatively expect to collect another $300 million or more. (California is no stranger to big IPOs — Golden State officials calculated they would collect $2.5 billion over four years from Facebook’s debut.) Not everyone is quite so happy. Two years ago, the city of San Francisco waived part of its payroll tax to keep Twitter headquartered downtown. City officials predicted the waiver would cost them $22 million over six years. Last week’s windfall could mean leaving another $34 million on the table. Of course, the City by the Bay still collects millions more than if Twitter had bugged out for the suburbs. Who’s not paying a dime in tax? That would be Twitter itself. Of course, that’s because they haven’t made a dime in profit. In fact, Twitter has over $100 million in “net operating loss carryforwards” it can use to offset tax on future profits. Twitter’s investors and employees have some big tax planning challenges ahead. They’re going to need more than just 140 characters to take advantage of all the legal strategies available to pay less. It works the same for you, even if you’re not America’s newest billionaire. If you want to #keepwhatyoumake, you need a plan. So call your accountant now before December 31, when you can still do something about it! Allan J Rolnick is a CPA who has been in practice for over 30 years in Queens, NY. He welcomes your comments and can be reached at 718-896-8715 or at allanjrcpa@aol.com.
Skinny But Powerful
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hanksgiving and Chanukah overHowever, one important overlap lap this year. How does that work to watch out for is how things lay out. out for us? You must make sure not to rest your • Well, the Chanukah celebration gezunta turkey in front of the window, lasts a full 8 days even if you are longing to impress your • Thanksgiving celebrations, neighbors with your masterpiece. Beabout 8 hours! cause you might totally block out the • Thanksgiving we eat a stuffed light of those poor skinny Chanukah turkey candles. And that, of course, is a ma• Chanukah? Oh yes, a stuffed jor no no!! It’s not gezunta candles that jelly donut matter but rather the light it throws off. • Chanukah has no required meal. Thanksgiving is a time to be grateYou are definitely ful for our country, permitted to eat, America. Chanubut only candlekah is a time to be light is required! grateful for our Let’s enlighten Jewish heritage and Thanksgiving you can certainly what it gives us to the world with have the candleshare wherever we light but only the are: our approach to the knowledge meal is required! life, our values, and that we should our moral behavior. They don’t get With us it isn’t how in each other’s all be grateful big we are in size way. But how do or number rather, they offset each for everything it is how bright we other? shine. Listen, we alwe have. ways have a bit of Thanksgiving a challenge with is a great name for Thursday being a holiday. After all Thanksgiving and we are “the Thank Shabbos following right on its heels. You People” the Yehudim, meaning You know, it’s another big meal we’ve hod. And we do start each day with got to prepare, set up, and ingest… Modeh Ani, Thank you G-d. We are all That makes Thursday night, Friday about remembering to be grateful. So night, Shabbos day, and of course, we by having Chanukah overlap Thankscan’t resist Saturday night eating out giving let’s try to pull out the best meswith friends. That’s a lot of eating in sage: Let’s enlighten the world with the a short span. And yes, we surely are knowledge that we should all be gratequite adept at it from celebrating three ful for everything we have. Though our day holidays. But adept doesn’t mean candles are skinny, let them be powerenthusiastic about doing it again! ful! Now, all of a sudden, Chanukah throws itself into the mix. Fortunately, Chanukah is not about some giant Rivki Rosenwald is a certified relationmeal. In fact, it’s all about oil which ship counselor, and career and life coach. actually helps all the other food slide She can be contacted at 917-705-2004 or rivki@rosenwalds.com. down more easily.