Return of SALT deduction spicing up debate on Capitol Hill

A cherished tax deduction that hit high-income earners in New York, California and New Jersey and was eliminated by the Trump Administration may soon be making a comeback. 

Momentum is building for the reinstatement of the federal government's state and local tax deduction better known as the SALT deduction FOX Business has learned. The deduction was nearly eliminated as part of the former President Trump's Tax Cuts and Jobs Act of 2017. Instead, the federal government instituted a $10,000 cap on the SALT deduction. Previously there was no cap.  READ MORE

Verizon retirees take aim at CEO Vestberg’s $40 million ‘golden parachute’

Jack Cohen retired from Verizon nearly 20 years ago. Since then he’s taken on a new role: Fighting on behalf of company retirees and ordinary stockholders, sometimes in open battle with the current board of directors.

He’s at it again.

Cohen, who leads the Association of BellTel Retirees, is fighting the board at this week’s annual stockholder meeting over fat cat pay, including the $40 million ‘golden parachute’ offered to current Chief Executive Hans Vestberg. READ MORE

I own a small business — this is what a $15 minimum wage means for me

After President Biden required federal contractors to pay a $15 minimum wage and Rhode Island inched closer to its own mandate, small-business owners held their breath. Congress is again likely to consider hiking the federal minimum wage, now $7.25, affecting the public and private sectors alike.

There is a popular mandate for a $15 federal minimum wage. Nearly two-thirds of Americans support the wage increase, include 40% who “strongly” back the proposal. In Florida, voters passed an amendment last November to raise the minimum wage, now $8.56, to $15 in 2026; it moves to $10 in September. READ MORE

Treasury and Finance Professionals Earned 2.9% Increase in Base Salaries in 2020; Lower Than Past Years

Treasury and finance professionals earned an average 2.9% base salary increase in 2020, a 0.8% decrease from the 3.7% gain in 2019, according to the 2021 Association for Financial Professionals (AFP) Compensation Survey. The base pay increase of 2.9% is the lowest salary increase reported in the past seven years, according to the new report.

The 2021 AFP® Compensation Survey reveals base-salary raises for executive-tier positions at 2.6%, which is 0.7% less than reported a year ago, while there was a 0.5% decrease in salaries for staff-tier positions. At the management-tier level, the average 3.1% increase in base salaries during the calendar year 2020 is 1.2% less than the base salary increase reported in last year's survey. READ MORE

UBS dangles $40,000 bonuses to slow exodus of overworked junior bankers

Swiss bank UBS will offer its junior banking analysts a $40,000 bonus when they are promoted to the associate level — the latest bid by financial giants to retain younger workers amid an explosion in dealmaking.

The payout is roughly double what competitors like Credit Suisse and Wells Fargo are reportedly offering to keep rookie employees amid increasingly grueling routines, and amounts to roughly 30 percent of the annual base salary of a new associate, according to Bloomberg, which first reported the news on Monday. READ MORE

Income equality is the wrong goal

Many Americans, especially progressives, believe that the income gap between the haves and the have nots is too large.

Progressives see income inequality as a flaw in capitalism and a reason to transform the economy to socialism. In the name of “equity,” the Biden Administration and Democrats in Congress are seeking to increase taxes on those who are wealthy and add to government entitlements for those who are not. READ MORE

States With No Income Tax

The federal deficit hit an all time high of over $28 trillion in March 2021. Unlike the federal government, however, nearly all states are constitutionally required to have a balanced budget and depend on multiple sources of tax revenue to fund operations. No two state tax structures are exactly alike, and in some parts of the country, Americans pay fewer taxes than in others. 

One of the primary revenue sources for most states is income tax. Depending on the state, personal income tax can account for over one-third of overall tax revenue — a tax burden shouldered exclusively by workers and investors. There are, however, eight states that do not levy any personal income taxes, and one additional state that only taxes income from interest and dividends.  READ MORE

Income influenced where Americans moved in 2020

Researchers at Vanderbilt University recently studied patterns of people moving from place to place during the pandemic. They found a significant percentage of people moved from larger cities to smaller cities, but the reasons for relocating were different depending on their earnings.

When the pandemic hit last year, Mack McKelvey was renting a two-bedroom apartment in Manhattan. She runs a marketing firm, and before COVID-19, it made sense for her to be in New York. But working remotely, her location didn’t matter. So in September, she looked for a place in Vermont. READ MORE

Worst-paying blue chip employers bolstered CEO pay in pandemic, report says

More than half of 100 companies with the lowest median employee wages in the S&P 500 Index boosted CEO pay by changing the rules for assessing executive performance during the COVID-19 pandemic, according to a report by a left-leaning policy group published on Tuesday.

The report from the Institute for Policy Studies found that 51 of these 100 companies, including beverage and snack maker Coca-Cola Co, cruise ship operator Carnival Corp and fast food corporation Yum Brands Inc, reduced median worker pay by 2% to $28,187 on average in 2020 compared to 2019, even as the median compensation for their CEOs rose 29% to $15.3 million. READ MORE

DOL Withdraws Trump-Era Independent Contractor Rule

The United States Department of Labor (DOL) announced on Wednesday that it is withdrawing the independent contractor rule that passed under the Trump administration.

The rule was slated to take effect on March 8. However, the Biden administration asked federal agencies to freeze pending regulations to give new leaders time to review them. The final rule, which was considered a more employer-friendly interpretation of employee status under the Fair Labor Standards Act than what was applied during the Obama administration, adopted an “economic reality” test for determining which workers qualify as independent contractors or employees. The rule primarily considered two “core factors” and three “guidepost factors” for determining if the worker is economically dependent.  READ MORE

MSNBC's Ruhle ripped for scolding businesses to raise wages after poor jobs report: 'Never run a business'

MSNBC anchor Stephanie Ruhle was slammed Monday for her take on how government unemployment benefits are affecting the U.S. labor force, arguing that the real question is why aren't employers offering workers higher wages.

In response to an underwhelming April jobs report, some liberals are pushing back against the notion that unemployment benefits are discouraging a return to the workforce.

"Why is it - that the unemployment benefits are too generous rather than the pay offered by employers too low?" Ruhle asked Sunday. "Pay more $ = find more workers [sic] If margins are so thin, that you cannot increase pay without passing it through/losing customers = your biz model doesn’t work." READ MORE

Chipotle says employees can make $100,000 after just 3 years on the job

Restaurants are struggling to hire workers, so some, including Chipotle, are trying to sweeten the pot with higher pay and bigger career opportunities.

Chipotle is increasing the pay of its restaurant workers to an average of $15 per hour, the chain announced Monday. Some employees will become eligible to make a six-figure salary after just a few years on the job. READ MORE

Rep. McHenry introduces Gig Worker Equity Compensation Act

U.S. Rep. Patrick McHenry (R-NC) introduced legislation that would include the gig workforce in the category of workers who can benefit from equity compensation.

The Gig Worker Equity Compensation Act (H.R. 2990) would help gig workers share in the economic resurgence while preserving their flexibility and independence. READ MORE

Sasse pitches 'signing bonus' for workers on unemployment who get a job

Sen. Ben Sasse announced he would introduce legislation that would reallocate expanded unemployment benefits into signing bonus payments for new hires, after this week’s disappointing jobs report. 

Sasse said the bill would convert the pandemic-expanded federal unemployment benefit, which is currently up to $300 per week, into a two-month signing bonus "equal to 101 percent of their current unemployment payment."  READ MORE

Startup employees should pay attention to Biden’s capital gains tax plans

The Biden Administration has reportedly proposed significant changes to the capital gains tax, aiming to target the wealthiest Americans to help fund his historic aid programs.

If the current proposal goes into effect, it will have an impact on startup employees who aren’t (yet) wealthy. And it’s unlikely the Biden Administration has considered the consequences, because many of these employees aren’t yet in the highest tax bracket. But startup employees need to pay close attention to these changes when planning what to do with their stock options. READ MORE

Will Biden’s American Families Plan Take Aim at Executive Compensation?

There already has been a lot of discussion about the elements anticipated to be part of President Joe Biden’s American Families Plan, including some of the tax increases being considered to pay for the proposed “human infrastructure” benefits. One question largely undiscussed to date is to what extent will proposals affecting executive compensation be utilized to help offset the spending provisions of the American Families Plan? READ MORE

Illinois Employers Must Report Gender, Race, Ethnicity And Compensation Data And Practices

Under amendments to the Illinois Business Corporation Act and the Illinois Equal Pay Act, certain corporations will be required, beginning in 2023 and continuing thereafter, to report data concerning the gender, race, and ethnicity makeup of their workforces, along with information about their compensation practices and efforts to comply with equal pay laws. Much of this information will become public, and failure to report the necessary information can lead to significant penalties. READ MORE

Will employers change your salary if you move to a cheaper area?

Some companies adjust pay depending on where employees live, raising the question of whether they’ll change employees’ salaries now that working remotely is becoming more common.

In a new survey about work-from-home policies, 4.3% of companies who responded said they would reduce employee’s cash compensation if they moved to a lower-cost geographic area, while 56.5% said they wouldn’t, according to the executive compensation consultancy Pearl Meyer. About a quarter of respondents said that it would depend on the individual situation and about 14% said they’re unsure.  READ MORE

Incentive Compensation: When a Promise Becomes a Myth

Money makes the world go round, a truth as reliable as death and taxes. Companies often lure and retain high performing employees, particularly executives, through promises of incentive compensation. Sophisticated employees seek certainty through a written agreement specifying their compensation package, while employers often insist on maintaining a large degree of discretion over performance-based compensation. This tension frequently results in a written agreement that contains language so broad that its enforceability becomes questionable. READ MORE

Figure raises $7.5M to help startup employees better understand their compensation

The topic of compensation has historically been a delicate one that has left many people — especially startup employees — wondering just what drives what can feel like random decisions around pay and equity.

Last June, software engineers (and housemates) Miles Hobby and Geoffrey Tisserand set about trying to solve the problem for companies by developing a data-driven platform that aims to help companies structure their compensation plans and transparently communicate them to candidates. READ MORE