> it's seems a bit rough for it to be a tax event if you are locked out of liquidating for six months.
Life is not fair. And the tax code is totally ridiculous.
> I guess you could have hedged or something.
A prior version of rule 144 explicitly stated that any kind of hedging is unlawful. The current revision is unclear on that. My counsel advised me against doing anything, as (in the extremely unlikely case of an SEC inquiry) my representation would cost several times the profits I would have insured. (And .. I had no reason to expect a 50% drop, practically overnight, a couple of months after the deal went through).
There's apparently complex ways to legally avoid the tax event until your profits are realized, which are worthwhile if you're a big VC or something and manage tens of millions of dollars. But they would probably trigger an audit and the IRS deciding you are cheating if you do that as an individual.
Romney can afford these things. I can't. The tax code is completely borked.
Well, if you're willing to run afoul of SEC regulations, you can do much more lucrative things, like manipulate the LIBOR, provide inside information to select customers and use it yourself :)
(And what do you know - the big boys on Wall Street actually do those lucrative but not really legal things!)
Life is not fair. And the tax code is totally ridiculous.
> I guess you could have hedged or something.
A prior version of rule 144 explicitly stated that any kind of hedging is unlawful. The current revision is unclear on that. My counsel advised me against doing anything, as (in the extremely unlikely case of an SEC inquiry) my representation would cost several times the profits I would have insured. (And .. I had no reason to expect a 50% drop, practically overnight, a couple of months after the deal went through).
There's apparently complex ways to legally avoid the tax event until your profits are realized, which are worthwhile if you're a big VC or something and manage tens of millions of dollars. But they would probably trigger an audit and the IRS deciding you are cheating if you do that as an individual.
Romney can afford these things. I can't. The tax code is completely borked.