Bill Gates' generosity reappears
Frazer Wright
which may have been dissected on previous occasions, but yesterday's
Daily Telegraph, (January 20, 2001) in the UK led its city diary with
the following story.
Allowing that the Telegraph is a usually reputable, if occasionally
over-excitable print, am I being overly suspicious in wondering if a
legend is being woven here?
"PETER Eyles, chairman of Hanover International Hotels, has just
returned from Whistler, Canada, where he met a ski pro with an
interesting story. The pro had been driving home from the slopes, when
he came across a car that had skidded off the
He stopped to offer the services of his 4x4 and towbar, only to discover
that the hapless driver was Bill Gates. The Microsoft chief was
delighted to accept his offer, thanked him and went on his way.,
The following month the Good Samaritan's bank statement showed a deposit
of $25,000. He was honest enough to query the payment with his bank
manager, who suggested he might like to come in for a chat. When he did
so, he was told that not only had Gates paid the $25,000 - he'd paid off
his mortgage. Not bad for 10 minutes' work, although I do wonder how
good ol' Bill acquired the man's account details ..."
Mitcho
> The following month the Good Samaritan's bank statement showed a deposit
> of $25,000. He was honest enough to query the payment with his bank
> manager, who suggested he might like to come in for a chat. When he did
> so, he was told that not only had Gates paid the $25,000 - he'd paid off
> his mortgage. Not bad for 10 minutes' work, although I do wonder how
> good ol' Bill acquired the man's account details ..."
I dunno, but when I have tried to give some largish amounts to people
I have been snared by the permanent effect it has on your lifetime
personal exemption (US tax laws, every individual taxpayer can
transfer a certain amount of property during his or her lifetime
without paying estate or gift tax due to a lifetime exemption amount.
This exemption amount is used to calculate the credit available to
offset the unified transfer tax upon death; the exemption amount is
currently $675,000 and increases annually). Every gift in excess of
$10,000 you make to another person per year is deducted from the
lifetime personal exemption.
Now I suppose that the $675,000 exemption amount is kind of peanuts to
Bill Gates, and he has made other arrangements to protect his estate,
but if you ran around paying off the mortgages of everyone who did you
a good turn, pretty soon your lifetime personal exemption would be
gone.
You could pay the money out of a trust, however, with no consequences.
It is not unreasonable to expect that extremely wealthy people have
set up trusts for this very purpose.
Not that I believe this story. Not easy for you to pay off my
mortgage without telling me about it. If someone did, I would be all
over my bank's ass for breach of confidentiality.
The US tax law is hella complicated, unintuitive and unfair. Just
wait until next month or March when we start hearing about suicides of
dot.commers who exercised their stock options without selling early
last year, when they find out from their accountants what this will
mean to their financial situation.
Mitcho
--
The Urban Redneck : red...@goathill.net : Goat Hill, California
http://www.employees.org/~redneck
Paul Tomblin
>Not that I believe this story. Not easy for you to pay off my
>mortgage without telling me about it. If someone did, I would be all
>over my bank's ass for breach of confidentiality.
The other major hole in the story is that until he married Melinda, he was
a notorious tightwad. Not only did he give less to charity than most
people making 1/100th as much as him, but most of what he did give to
charity was copies of Microsoft software, so he made money off it.
--
Paul Tomblin <ptom...@xcski.com>, not speaking for anybody
The superior pilot uses his superior judgement to avoid situations in which he
has to demonstrate his superior skill.
Tom Sevart
"Frazer Wright" <fra...@oliver7.demon.co.uk> wrote in message
news:1enkwmz.1jf6789c74t34N%fra...@oliver7.demon.co.uk...
<snip story of Good Samaritan stopping to help stranded motorist that turns
out be be Bill Gates, finds extra $25,000 wired to his bank account>
I hadn't heard this one before, but it seems to be a new variant on an old
story. Good Samaritan stops to help a driver, the driver turns out to be
someone rich/famous, Samaritan finds extra money in his account. It also
appears to be a UL since the story was related by an anonymous skier, not
someone you can check with to see if the story actually happened or not.
Classic UL. Stop to help someone in need, and find yourself rewarded.
Tom "Why can't Bill Gates run off the road in my nieghborhood?" Sevart
danny burstein
>The other major hole in the story is that until he married Melinda, he was
>a notorious tightwad. Not only did he give less to charity than most
>people making 1/100th as much as him, but most of what he did give to
>charity was copies of Microsoft software, so he made money off it.
err, not quite. If a company gives a "product" that they make as a
charitable donation, they can't deduct the "suggested retail price" but
rather, the manufacturing cost.
So when Bill's trust gives out 1,000 copies of W-98 which sells for (I
dunna, let's say) $100 apiece, he does NOT get a $100,000 tax benefit.
Instead he gets, perhaps, one for $5,000 based on a cost $5 each.
that's not to say he doesn't issue a press release for the $100,000. But
the IRS [1] only allows the smaller figure.
Note that calculating the value for tax purposes is quite tricky. In a
"hard" product, for example, a fuel dealer providing the heating oil for
the local county orphange, it's pretty straighforward. (simply take the
price the dealer paid at wholesale - which is probably about 75% of the
normal selling cost [ignoring the huge amount of sales taxes...] and add a
few percents for misc overhead). But when you're dealing with something
more nebulous like... a computer operating system where the cost of each
shipped product is just a couple of bucks but you sell it for lots, lots,
more... suffice to say this makes IRS auditors drool.
And, natch, there are many ways to structure these gifts so as to make
their value higher. or lower. But let's not get into a discussion of USA'n
tax code, please.
danny 'woudn't mind receiving a copy of MAC OS X - especially if it came
wrapped in a Titanium Powerbook' burstein
[1] ob twiavb/boa: IRS = Internal revenue Service. The primary US gov'tal
tax agency. The one that got Al Capone.
--
_____________________________________________________
Knowledge may be power, but communications is the key
dan...@panix.com
[to foil spammers, my address has been double rot-13 encoded]
squilsh
Did he tell Bill that he was his "number one fan"? :-)
paul
Wright <fra...@oliver7.demon.co.uk> writes
>"PETER Eyles, chairman of Hanover International Hotels, has just
>returned from Whistler, Canada, where he met a ski pro with an
>interesting story. The pro had been driving home from the slopes, when
>he came across a car that had skidded off the
>
>He stopped to offer the services of his 4x4 and towbar, only to discover
>that the hapless driver was Bill Gates. The Microsoft chief was
>delighted to accept his offer, thanked him and went on his way.,
And then named the next version of Windows after the location?
--
paul
58-77 Sheffield 77-79 Coventry 79-88 Sheffield 88-97 Milton Keynes 97-99 London
99-00 Seattle 00-?? Fremont
Paul Tomblin
>In <94f16d$2qf$1...@allhats.xcski.com> ptom...@xcski.com (Paul Tomblin) writes:
>>people making 1/100th as much as him, but most of what he did give to
>>charity was copies of Microsoft software, so he made money off it.
>err, not quite. If a company gives a "product" that they make as a
>charitable donation, they can't deduct the "suggested retail price" but
>rather, the manufacturing cost.
So he makes money by deducting the (few pennies per unit) manufacturing
cost, he gets to tell the sheeple that he donated billions of dollars
worth of software (based on the retail value), and he makes money based on
the publicity value and free advertising.
This is a lot different from giving money out of your pocket to a
deserving charity. It's probably no better than what the rest of the very
rich do, but it doesn't make him any less of a scumbag.
--
Paul Tomblin <ptom...@xcski.com>, not speaking for anybody
"In My Egotistical Opinion, most people's C programs should be
indented six feet downward and covered with dirt."
-- Blair P. Houghton
Mitcho
> This is a lot different from giving money out of your pocket to a
> deserving charity.
Heaven knows, Bill Gates would never do a thing like *that*.
> It's probably no better than what the rest of the very
> rich do, but it doesn't make him any less of a scumbag.
Personally, I have been very very impressed with some of the
beneficiaries of the Bill & Melinda Gates Foundation. Important stuff
like medicine and education for third world people. I don't hear that
much about opera houses and, er, gifts to the UN bureacracy.
Robert Alston
"Paul Tomblin" <ptom...@xcski.com> wrote in message
news:94gb71$rlj$1...@allhats.xcski.com...
> In a previous article, dan...@panix.com (danny burstein) said:
> >In <94f16d$2qf$1...@allhats.xcski.com> ptom...@xcski.com (Paul
Tomblin) writes:
> >>people making 1/100th as much as him, but most of what he did give
to
> >>charity was copies of Microsoft software, so he made money off it.
> >err, not quite. If a company gives a "product" that they make as a
> >charitable donation, they can't deduct the "suggested retail price"
but
> >rather, the manufacturing cost.
>
> So he makes money by deducting the (few pennies per unit)
manufacturing
> cost, he gets to tell the sheeple that he donated billions of
dollars
> worth of software (based on the retail value), and he makes money
based on
> the publicity value and free advertising.
Your bias is showing Paul. Having called a friend of mine who IS an
accountant I got a few figures.
Fluid assets of the Bill and Melinda Gates Foundation: Currently over
5 billion dollars US. (it is currently gaining a good sized chunk of
change each day due to interest so the actual number is variable)
Check with Forbes. They seem to be keeping track of it.
Value of a CD-Rom (deductable for a corp like microsoft or a person
like Gates) approx 30 cents US. Maybe as high as 40 or 50 cents. At
the highest value that comes to 10 BILLION CD's. Is that why I haven't
been able to buy any for the past couple of years? Bill Gates sucking
up the entire world supply of available CD's?
And just a little note: Fluid assets are convertable securities. Cash,
stocks and bonds. CD's don't qualify.
>
> This is a lot different from giving money out of your pocket to a
> deserving charity. It's probably no better than what the rest of
the very
> rich do, but it doesn't make him any less of a scumbag.
He coughed up cash and stock certificates. He may or may not be a
scumbag (and that wouldn't be a fit discussion for AFU in any case)
but he did dig into his pockets.
>
> --
> Paul Tomblin <ptom...@xcski.com>, not speaking for anybody
Obviously.
Robert "My personal feelings towards his business ethics or lack
thereof did not influence this post" Alston
mint...@my-deja.com
different..A woman from around here was driving down the Sth. Gippsland
Hwy and saw a man in a suit walk onto the road and flag her down , when
she stopped he said his boss was running late for a meeting and they
blew a tyre , could she please give them her spare tyre ..She did and
then they asked for her bank account number..Of course she gave ot to
them (as you would) and a month later had One hundred thousand dollars
in her bank account plus her house paid off..Her bank told her it was
deposited by a Bill Gates...
So as you can see , there must be a hell of a lot of people out there
that were in the right place at the right time..Or maybe Bill Gates
needs to get his cars mechanically checked before going to meetings..LOL
Sent via Deja.com
http://www.deja.com/
jerryG
paul <paul...@alienbigcats.com> wrote:
> In article <1enkwmz.1jf6789c74t34N%fra...@oliver7.demon.co.uk>, Frazer
> Wright <fra...@oliver7.demon.co.uk> writes
>
> >"PETER Eyles, chairman of Hanover International Hotels, has just
> >returned from Whistler, Canada, where he met a ski pro with an
> >interesting story. The pro had been driving home from the slopes,
> > when he came across a car that had skidded off the
> >
> > He stopped to offer the services of his 4x4 and towbar, only
> > to discover that the hapless driver was Bill Gates. The
> > Microsoft chief was delighted to accept his offer, thanked him
> > and went on his way.,
>
> And then named the next version of Windows after the location?
Whistler Blackcomb? Apparently, Bill does own a house in Whistler, BC.
Jerry "mogul" G
--
And your wise men don't know how it fe-ee-eee-els,
to be thick... as a brick. Jethro Tull
Paul Tomblin
>"Paul Tomblin" <ptom...@xcski.com> wrote in message
>news:94gb71$rlj$1...@allhats.xcski.com...
>manufacturing
>> cost, he gets to tell the sheeple that he donated billions of
>dollars
>> worth of software (based on the retail value), and he makes money
>based on
>> the publicity value and free advertising.
>
>Your bias is showing Paul. Having called a friend of mine who IS an
>accountant I got a few figures.
Your inability to read is showing, Robert. I specifically said a few
posts up the thread that this is *before* he married Melinda. Melinda
seems to have overpowered his natural stinginess and gotten the Bill and
Melinda Gates Foundation to donate money even to things that don't
directly help sell Microsoft products.
--
Paul Tomblin <ptom...@xcski.com>, not speaking for anybody
One item could not be deleted because it was missing.
-- Mac System 7.0b1 error message
Mike Sphar
following? Read the book:
>Not that I believe this story. Not easy for you to pay off my
>mortgage without telling me about it. If someone did, I would be all
>over my bank's ass for breach of confidentiality.
I don't know about mortgages, but years ago I used to be able to make a
deposit into a friend's bank account just by giving their name. If I
recall, I wouldn't get to keep the receipt or get any information about the
account owner. I don't know if I could still do that today though.
That brings up a good question: is there really any guarantee of
confidentiality with a mortgage or other loan, legally speaking?
--
Mike Sphar http://www.dogfacedboy.org/
Not matter how fast light travels it finds the darkness has always got
there first, and is waiting for it. -- Terry Pratchett, "Reaper Man"
Karen J. Cravens
<0fbv6tk27qpn87mlh...@news-west.speakeasy.net>:
>I don't know about mortgages, but years ago I used to be able to make a
>deposit into a friend's bank account just by giving their name. If I
>recall, I wouldn't get to keep the receipt or get any information about
>the account owner. I don't know if I could still do that today though.
Yes. You do get a receipt (at least, anecdotally speaking; the bank I
worked for gave them) but it doesn't include any of their account details.
--
Karen "dunno about mortgages either, though" Cravens
Mitcho
> >deposit into a friend's bank account just by giving their name. If I
> >recall, I wouldn't get to keep the receipt or get any information about
> >the account owner. I don't know if I could still do that today though.
A deposit is different. You're not learning anything about your
friend's account.
When I lived in the UK (early nineties), I used to send completed
deposit slips to a cow orker in California so she could deposit my
expense checks for me. Note that no signature is required on a
deposit slip, unless you want cash back. I wrote my account number on
the deposit slip, but you can get that from any check I write.
Mitcho
And I write a lot of checks, dammit.
Deborah Stevenson
On Thu, 25 Jan 2001, Mitcho wrote:
> > use...@dogfacedboy.org (Mike Sphar) wrote in
> >
> > >I don't know about mortgages, but years ago I used to be able to make a
> > >deposit into a friend's bank account just by giving their name. If I
> > >recall, I wouldn't get to keep the receipt or get any information about
> > >the account owner. I don't know if I could still do that today though.
>
> A deposit is different. You're not learning anything about your
> friend's account.
Would they suppress the usual receipt that includes balance information
and account number? I bet they'd hand that right to you at the banks down
here.
> When I lived in the UK (early nineties), I used to send completed
> deposit slips to a cow orker in California so she could deposit my
> expense checks for me. Note that no signature is required on a
> deposit slip, unless you want cash back.
The bank I just left required a thumbprint, basically for whatever
deposits they felt like. I suspect they'd have felt like it with
third-party deposits. And then they'd have handed you the receipt with
full account information, because they were just that bright.
Deborah Stevenson
(stev...@alexia.lis.uiuc.edu)
yu...@my-deja.com
ptom...@xcski.com (Paul Tomblin) wrote:
> In a previous article, "Robert Alston" <rom...@onemain.com> said:
> >"Paul Tomblin" <ptom...@xcski.com> wrote in message
> >news:94gb71$rlj$1...@allhats.xcski.com...
> >> So he makes money by deducting the (few pennies per unit)
> >manufacturing
> >> cost, he gets to tell the sheeple that he donated billions of
> >dollars
> >> worth of software (based on the retail value), and he makes money
> >based on
> >> the publicity value and free advertising.
> >
> >Your bias is showing Paul. Having called a friend of mine who IS an
> >accountant I got a few figures.
>
> Your inability to read is showing, Robert. I specifically said a few
> posts up the thread that this is *before* he married Melinda. Melinda
> seems to have overpowered his natural stinginess and gotten the Bill
and
> Melinda Gates Foundation to donate money even to things that don't
> directly help sell Microsoft products.
Let's see. Stingy billionaire is helped by good smaritan, who is then
rewarded. Explains a lot. Bill Gates is the reincarnation of Howard
Hughes.
Joe Yuska
Nick Spalding
> And I write a lot of checks, dammit.
Since the advent of debit cards in these parts, accepted by even quite
modest establishments, I have practically forgotten how to fill in a
cheque. And most of them will give additional cash back so I hardly
ever visit the ATM either.
--
Nick Spalding
Karen J. Cravens
<Pine.SGI.4.10.1010125...@alexia.lis.uiuc.edu>:
>Would they suppress the usual receipt that includes balance information
>and account number? I bet they'd hand that right to you at the banks
>down here.
They're not supposed to, but mine did. I was POD[1] on the account (it was
my mother's), and well-known to the CSR[2], since I worked in the
department next door, so that was an exception.
--
Karen "if you distract the CSR by chatting, it happens" Cravens
[1] Payable on Death. Gets around probate, I guess, without actually
having it be a joint account.
[2] Customer Service Rep. We got yelled at for calling them "tellers,"
same like we got yelled at at the airline for calling Flight Attendants
"stewardesses." Especially the male ones.
Dave O.
Paul Tomblin wrote:
>
> So he makes money by deducting the (few pennies per unit) manufacturing
> cost, he gets to tell the sheeple that he donated billions of dollars
> worth of software (based on the retail value), and he makes money based on
> the publicity value and free advertising.
>
This sounds like the report from five years back or so, when Microsoft
was asking China to crack down on software piracy. CDs were being sold
that had numerous Microsoft products on them. To estimate the amount of
money that Microsoft was losing to software piracy, they simply
multiplied the number of suspected CDs times the total retail value of
every piece of software on the CDs. It was some crazy figure like $500
billion.
Dave O.
Paul Tomblin
>money that Microsoft was losing to software piracy, they simply
>multiplied the number of suspected CDs times the total retail value of
>every piece of software on the CDs. It was some crazy figure like $500
>billion.
You think that's bad? Many years ago some guy in Toronto bought a
computer at auction. The previous owners hadn't wiped the system, and it
had a copy of the source code for AT&T Unix on it. AT&T somehow found
out, and demanded he wipe it. He said no, he'd bought it fair and square.
AT&T started legal action, and listed the value of the source code as
being the sum total of the salaries of everybody who had ever worked on
the project times the number of years that they had worked on it. The
number was in the hundreds of millions.
--
Paul Tomblin <ptom...@xcski.com>, not speaking for anybody
A fool and his money are soon flying more airplane than he can
handle.
John Schmitt
Mitcho <red...@goathill.net> writes:
>When I lived in the UK (early nineties), I used to send completed
>deposit slips to a cow orker in California so she could deposit my
>expense checks for me. Note that no signature is required on a
>deposit slip, unless you want cash back. I wrote my account number on
>the deposit slip, but you can get that from any check I write.
Barclays used to (and may still have) a system where the chrque and deposit
slip went into a special envelope and when this was put into the machine, it
gave a receipt for the envelope. This way just about anyone could make a
deposit for me if I was indisposed for whatever reason. I sort of lost my faith
in the system when it "lost" UKP 5000 into one of my secondary accounts instead
of my main one. This was just another of the multitude of bummers that buying a
house in the UK involved.
John "if it had been a lot of money, I would have been angry" Schmitt
--
As my computer gets older, it makes more typos and mistakes in general. Please
bear with this.
Cryptic: A mad, confused, nuisance (4)
Disclaimers Apply.
Brian Scearce
> Just wait until next month or March when we start hearing about
> suicides of dot.commers who exercised their stock options without
> selling early last year, when they find out from their accountants
> what this will mean to their financial situation.
You mean the fact that for non-qualified stock options (the commonest
kind) that the exercise of the option generates income equal to
the difference between the market price and the strike price, and
taxes are due on that income? That shouldn't be a surprise, I
think the tax code requires that (some) taxes be withheld at the
time of exercise.
--
Brian Scearce b...@best.com
Read, think, (possibly) post -- do not alter this order.
Mitcho
> You mean the fact that for non-qualified stock options (the commonest
> kind) that the exercise of the option generates income equal to
> the difference between the market price and the strike price, and
> taxes are due on that income?
Nope. Non-quals are treated just like regular income (usually, people
sell the shares the day they exercise them - a "same-day sell" - so
the total difference between the exercise price and the sell price is
treated as regular income.
What I am referring to is alternative minimum tax (AMT) on incentive
stock options (ISOs), which are common in pre-IPO start-ups. In this
case, you exercise your options and *hold* the shares, thinking they
will go up in value from the day you exercise them. You hope, at
least, to hold them for the year or two (I forget) so that they can be
treated as long term capital gains when you do sell them. However,
you will be subject to AMT on the difference between the exercise
price and the sell price on the day of exercise. This is a *paper
gain*, but you are still liable for AMT. In many cases, the tax owed
can be in excess of the total assets owned by the indivdual, in which
case he or she might borrow money to pay the tax (remember, this is
different from every other form of income tax you know, since in all
other cases you would be taxed on income or gains you have in your
hand; in this case, you are taxed on paper gains, though you might not
have made any money at all yet). The idea of AMT is to collect tax
*in advance* of when it might later be due (you can use the AMT paid
as credits in later tax returns).
Okay, so far so good if your shares are going up. You might want to
park the shares in a margin account and borrow from that to pay the
tax when it is due in April. If the shares drop precipitously in
value, your broker will issue a margin call and will probably close
out the margin loan by selling most or all the securing shares. You
might be unhappy about this, since now you have to pay taxes on short
term gains and also don't get to hold the shares in what you might
anticipate could be a rising market; but count your blessings because
far worse could have happened to you.
Suppose you were a dot.commer who had pre-IPO ISOs at an exercise
price of maybe pennies per share (very common). Early last year,
those shares might have been worth $100 per share or more. You are
vested in 1/4 of your total grant, and exercise what you can. You
have made a paper gain, in some cases, of several million dollars.
Whoo-hoo! You're rich! However, after March you watch your share
portfolio plummet in value, in many cases to less than 5% of what it
was worth in February. Bummer! Oh well, easy come, easy go. Not so
fast, though, come April 2001 you still will be subject to AMT on that
paper gain of several million smacks. The only way out is to sell
those now-worthless shares before 31 December 2000, which will cancel
the gain. A lot of folks have done this already, on advice from their
accountants. But many others have probably waited until early this
year to start working on their taxes, just as they have done every
year before. They are in for a shock. There will be more than a few
people with total assets on the near side of $100,000 who will
discover they owe the IRS several hundred thousand dollars or even
more than a million dollars. Now, it is one thing to owe your bank
money you can't pay, and it is another thing to owe VISA money you
can't pay, but it is a whole 'nother realm entirely to owe the IRS
money you can't pay. The IRS does not get treated like just another
creditor, even if you go bankrupt. They are normally on the backs of
bankrupt people forever. It's like owing child support - no way out.
The good news is you will have so many AMT credits you won't have to
pay much federal income tax for a long time. The bad news is you're
going to go bankrupt in the meantime, and spend a lot of time in tax
court.
There is no other way out of this, unless the IRS offers some relief
after a few people leap out of their Mission District lofts.
A sick and twisted tax code indeed.
Edward Rice
Mitcho <red...@goathill.net> wrote:
> When I lived in the UK (early nineties), I used to send completed
> deposit slips to a cow orker in California so she could deposit my
> expense checks for me. Note that no signature is required on a
> deposit slip, unless you want cash back. I wrote my account number on
> the deposit slip, but you can get that from any check I write.
Who signed the expense checks on the back, then?
--
Klaatu berada nictu. Get it?
Mitcho
> In article <d1n07toq4erbo7l5p...@4ax.com>,
> Mitcho <red...@goathill.net> wrote:
>
> > When I lived in the UK (early nineties), I used to send completed
> > deposit slips to a cow orker in California so she could deposit my
> > expense checks for me.
>
> Who signed the expense checks on the back, then?
Not me.
Mitcho
John Francis
Mitcho <red...@goathill.net> wrote:
>
>What I am referring to is alternative minimum tax (AMT) on incentive
>stock options (ISOs), which are common in pre-IPO start-ups.
[excellent description elided. In brief: n a declining market you'd
better sell them the year you get them, otherwise you will be liable
for tax on the full difference between option price and fair market
value at the time the option was exercised, not the difference between
the option price and the eventual sale price].
It's even worse than that - if you *do* sell the stock, but later on
decide to purchase some more stock at the new (presumably lower) market
price the IRS will treat the sale and repurchase as tax avoidance, and
stick you for tax on the whole price difference as stated above.