AAPL Stock: 119.19 ( + 1.38 )

Printed from

Eddy Cue joins Apple execs selling stock to avoid tax hike

updated 08:56 pm EST, Tue December 4, 2012

Capital gains taxes scheduled to go up next year

Apple's Senior Vice President of Internet Software and Services Eddy Cue has become the latest executive to dispose of a significant quantity of AAPL stock, according to a filing at the SEC. Cue has sold off nearly all of his shares (though he will be receiving more soon) to the tune of $8.76 million, parting with 15,000 shares and holding (albeit temporarily) just 285 shares presently. Like a number of other Apple executives, Cue is likely selling the shares to avoid a almost-certain rise in the rate of capital-gains taxation taking effect in January.

The past month has seen a rush of executives selling some or most of their holdings to avoid any tax increases on such income. Less than a week ago, SVP of Technologies Bob Mansfield sold $20.38 million worth of stock, likely for the same reason.

Regardless of which party primarily prevails in the showdown over the so-called "fiscal cliff," the default position (if a deal is unable to be struck) and the Democratic Party's position on this particular issue are the same: taxes on profitable sales of stock held longer than one year -- aka "long term" gains -- will go up from the current (and historically low) rate of 15 percent to 20 percent, with a special surcharge on some shareholders that will raise the effective rate to 23.8 percent.

It should be noted that long-term gains for those in lower income tax brackets (10 to 15 percent) will also see a rise in capital-gains taxes, from the current zero percent to 10 percent. Short-term capital gains will continue to be treated like regular income, and taxed at the rate corresponding to the taxpayers' bracket. The stock Cue just sold was valued at $584 per share, creating a total gross that is sufficiently high such that Cue could save up to a million dollars in potential tax liability by selling now.

Cue can expect to receive more shares as early as August of next year, when half of the 200,000 restricted stock units he has been awarded will vest. Most of the stock comes from awards for his promotion to SVP as well as some from a bonus awarded a year ago. All of the 200,000 shares will vest across the next three years (contingent on Cue staying with the company).

by MacNN Staff




Login Here

Not a member of the MacNN forums? Register now for free.


Network Headlines

Follow us on Facebook


Most Popular


Recent Reviews

Ultimate Ears Megaboom Bluetooth Speaker

Ultimate Ears (now owned by Logitech) has found great success in the marketplace with its "Boom" series of Bluetooth speakers, a mod ...

Kinivo URBN Premium Bluetooth Headphones

We love music, and we're willing to bet that you do, too. If you're like us, you probably spend a good portion of your time wearing ...

Jamstik+ MIDI Controller

For a long time the MIDI world has been dominated by keyboard-inspired controllers. Times are changing however, and we are slowly star ...


Most Commented