Transition Now that we can see that Amazons tax bill is cut in half by its

Transition now that we can see that amazons tax bill

This preview shows page 4 - 6 out of 7 pages.

[ 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 in 2017. 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. Conclusion IV. [ 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
Image of page 4
run our own businesses because of tax strategies like this; and, we will either benefit or suffer from it. References Amazon stock compensation: Great for employees but a liability. (2018, September 01). Retrieved March 24, 2019, from - compensation This 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.
Image of page 5
Image of page 6

You've reached the end of your free preview.

Want to read all 7 pages?

  • Spring '08
  • DONNELLAN

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern

Stuck? We have tutors online 24/7 who can help you get unstuck.
A+ icon
Ask Expert Tutors You can ask You can ask You can ask (will expire )
Answers in as fast as 15 minutes