[Transition]: Now that we can see that Amazon’s tax bill is cut in half by its stock-based compensation, it must deduct about another billion from somewhere else. This is where Amazon receives a substantial tax cut from being one of the most innovative companies in America.IV. Amazon is using research and development credits from investing in products such as Alexa and delivery drones to reduce the rest of their taxes to zero.A. I have already talked about the main influence Trump’s tax bill is having on Amazon, but there is a clause that has allowed Amazon to save over a billion dollars on taxes.1. Sissi Cao (2019), a writer for Observer.com,explains that due to TCJA Amazon does not have a limit on how many tax deductions they can use as there was a restriction on them before 2017. The company is allowed to use research and development credits from the last 20 years, which could last them for a very long time. 2. According to Rani Molla (2018), a writer for Recode.net, Amazon spent almost $23 billion on research and development in2017. Under the IRS, Amazon is allowed to deduct 4 to 8 percent of all R&D spending. This means that they saved between 920 million and 1.84 billion dollars on this policy alone. ConclusionIV. [Signal End]: Overall, we can now understand that Amazon has been paying $0 in income tax for the last two years through stock-based compensation, research and development credits, and other tax loopholes.A. [Review Main Ideas]: As we can see, Amazon has been using Trump’s Tax Cuts & Job Act to significantly decrease their federal tax responsibility, even to the point that the government has been paying them to operate the last two years. They also have been using a loophole through Bill Clinton’s tax reform by offering stock option pay to all employees to receive a considerable pay day. Lastly, as a technological giant they utilize research and development to improve the efficiency and relevance while saving billions of dollars in the process.B. [Sense of Closure/Relevance Statement]: I hope that after this presentation you realize how big of an impact this will have on American tax law and our studies at McCombs. We as businessmen and women will have to deal with new laws and strategies when we
run our own businesses because of tax strategies like this; and, we will either benefit or suffer from it. ReferencesAmazon stock compensation: Great for employees but a liability. (2018, September 01). Retrieved March 24, 2019, from -compensationThis article was a critical resource in my research of my second point as it provided a clear overview of an estimation of how Amazon's stock-based compensation works. It also provides the risks of this wage payment strategy which allowed me to have a better grasp on the system. Overall, this article was a major part of my research in my second main point and contributed nicely to my presentation.
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