In a race in opposition to looming adjustments to the tax code, Goldman Sachs handed out almost $100 million price of inventory awards to a few of its high executives.
Based on public filings posted Friday, ten Goldman executives — together with CEO Lloyd Blankfein and far of the corporate’s C-Suite — had been every scheduled to obtain a batch of inventory awards in January.
However the firm determined to ship the inventory grants in December as an alternative. The awards are price a mixed $94.eight million, the filings point out.
Goldman stated it moved the awards into 2017 due to “adjustments in U.S. tax legislation.” By paying them earlier than January, the financial institution will get monetary savings on its tax invoice.
The financial institution didn’t reply to requests for remark.
The brand new legislation marked essentially the most sweeping overhaul of the U.S. tax code in 30 years. It included a giant lower to the company tax charge, decreasing it to 21% from 35%.
However it made many different adjustments, and corporations are scrambling to adapt. The legislation was signed by President Trump simply earlier than Christmas and most provisions go into impact on January 1.
One provision adjustments how a lot corporations can deduct for the compensation they pay executives, stated Jared Walczak, a senior coverage analyst on the nonpartisan Tax Basis.
Beneath present legislation, corporations can solely deduct as much as $1 million per govt, however performance-based pay is excluded from the cap. However beginning January 1, that performance-based compensation will depend towards the $1 million.
That may successfully take away the tax incentive for corporations to tie pay to efficiency, whereas protecting base salaries underneath $1 million.
In a associated transfer, Netflix ( additionally reacted to the brand new tax legislation by altering its govt compensation plan for 2018. )
The corporate stated in a public submitting posted Thursday that it’ll begin paying a few of its high executives greater salaries, and tie much less of their compensation to efficiency, citing the legislation change.
CNNMoney (New York) First revealed December 29, 2017: 6:13 PM ET
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