• L0rdMathias
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    9 months ago

    Windfalls like this cannot be taking lightly and need to be approached strategically. It depends heavily on tax laws and employee finances overall.

    Some common got rich quick concerns off the top of my head: Could accidentally knock people into a higher tax bracket and ruin their finances long term for short term gain. Could accidentally give someone collateral to take out a massive loan they cannot afford long term. Could make someone in a low income area a target before they have a chance to move out. Could accidentally get double taxed by doing the payout incorrectly because they’re not practiced with handling this much money. Could overinvest it all back into the company and burn too brightly negating all their success. Doing nothing and simply using it as cash reserves is better than making a foolish mistake and ruining it for themselves.

    • borf@lemmynsfw.com
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      9 months ago

      These are all ludicrous.

      Could accidentally knock people into a higher tax bracket and ruin their finances long term for short term gain.

      This makes zero sense. Read up on how tax brackets actually work. Hitting higher tax brackets doesn’t mean your existing income is taxed at the higher rate. No “ruining.”

      Could accidentally give someone collateral to take out a massive loan they cannot afford long term.

      Wtf is this paternalistic BS. They could buy drugs or guns too!! 😱

      Doing nothing and simply using it as cash reserves is better than making a foolish mistake and ruining it for themselves.

      Nah. Pay people.

      • ZeroCool@slrpnk.netOP
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        9 months ago

        Could accidentally give someone collateral to take out a massive loan they cannot afford long term.

        Wtf is this paternalistic BS. They could buy drugs or guns too!! 😱

        “Paying people more would be irresponsible of us. The poors would be burdened with the responsibility of having too much money! It would destroy them!”

        • shalafi@lemmy.world
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          9 months ago

          with the responsibility of having too much money! It would destroy them!

          It often does, seen it firsthand. Hell, I doubled my income and benefits from last job to current. Did not manage it well, wasn’t prepared, fucked up my credit (though I always pay on time!), never learned about dealing with money.

          Also, are you suggesting a Japanese company of software devs are “poors”?! Don’t even know how to reply…

          This whole thread cements my view that lemmings are a bunch of teens and 20-somethings that have little real-world experience and are angry at what their generation is waking up to. (And you SHOULD be angry. But FFS, take a deep breath, take a wider, longer view.)

          • ZeroCool@slrpnk.netOP
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            9 months ago

            This whole thread cements my view that lemmings are a bunch of teens and 20-somethings that have little real-world experience and are angry at what their generation is waking up to.

            Yes dear, everyone that disagrees with you is just an angry child. 🙄

      • Bugger@mander.xyz
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        9 months ago

        Posting US tax code like it’s the only country in the world and using it as a basis to say something about a Japanese company could be construed as ludicrous, could it not?

        And you choose drugs or guns for your example? Again, JAPAN.

        Japanese bonuses are heavily taxed and highest salary periods can have big implications on how much one has to pay into the national pension system. The way taxes are paid in arrears can also very easily put people in difficult positions if they aren’t financially responsible and happen to suddenly lose their jobs.

        • xradeon@lemmy.one
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          9 months ago

          Still doesn’t matter if something is “heavily taxed” because regardless of how much tax, you’ll never own more in taxes than you made. So if you got a 10,000 bonus and it was heavily taxed at 60 percent, you don’t somehow have to pay like 15,000 in taxes or something on it. You pay 60% of 10,000, leaving you with 4,000 left over. This is typically done before you even see the money, if not ensure that you keep funds aside to pay for the tax.

          Also looking briefly at Japan, it appears that their income tax is a bracket based system similar to the US. So again, even if you go up a bracket, you’ll never own more taxes than you make. Honestly, people need to stop thinking in brackets when it comes to taxes, all you need to worry about is your “effective tax rate.” That’s it, you don’t need to worry that your income pushed you into a 29% tax bracket or whatever. All that matters is your effective tax rate is 24.2% or whatever. You’ll never own more money because you “moved” into a higher bracket, because that’s not how that works.

        • Maalus@lemmy.world
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          9 months ago

          No tax system in the world taxes all your income after you reach a higher tax bracket. It’s always “all the money above X amount is taxed higher”. Even if that would somehow be the case, they got so much cash, you don’t even realize how insignificant any type of tax is. They are set for life. They have like a 3 person gaming studio.

        • GBU_28@lemm.ee
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          9 months ago

          It doesn’t matter if they tax bonuses 99% , you are still gaining net income

    • AdmiralShat@programming.dev
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      9 months ago

      …you can’t ruin finances by knocking some one into a different tax bracket. This statement alone proves you don’t understand how tax brackets work

      • Takumidesh@lemmy.world
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        9 months ago

        In the us, there are very rare cases where someone’s income straddles the line between benefits with a higher value than the increased income. This is not one of those cases, and it effectively only applies to people are below the poverty line and gain only a few hundred dollars in income.

    • Randomgal@lemmy.ca
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      9 months ago

      Imagine being so brainwashed by your Robber Baron overlords that you literally think: More money = less money. Sad.

      • shalafi@lemmy.world
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        9 months ago

        It often works that way. Look at lottery winners and NFL players who end up broke as fuck overnight.

        Anecdote: Knew a guy who scored a cool $1,000,000 off the VA for a testicular cancer misdiagnosis. Somehow blew every penny in 12-months, lost it all, ended up worse off. And promptly died.

        This’ll trip everyone up. Paying more does not lead to better outcomes. Y’all should love it. If you read between the lines, there’s a lot of Linux culture in there. Explains much of what I’ve seen IRL.

        https://www.youtube.com/watch?v=u6XAPnuFjJc&t=1s

        • Randomgal@lemmy.ca
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          9 months ago

          “Lottery Winners and NFL Players” You mean it works that way often for the 1% of the 1%? Wtf are you even saying? Are you a bot or is chatGPT writing this for you? You don’t think that paying more to the 80% of Americans that live PAYCHECK TO PAYCHECK is going to be a good thing for them? Do you really think that not fearing homelessness is actually gonna make them sadder? Lol.

          I hope you’re trolling and not really so sadly blind to the reality world you live in.

    • ZeroCool@slrpnk.netOP
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      9 months ago

      This is probably the most ridiculous comment I’ll read on Lemmy all year and it’s only March. Wow.

    • yeather@lemmy.ca
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      9 months ago

      Bro said the most wrong thing I’ve seen all week and won’t respond.

      • M500@lemmy.ml
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        9 months ago

        What if you have too much money and you become a target?

        Well that’s on you for letting people know about if.

        • yeather@lemmy.ca
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          9 months ago

          This isn’t a lottery amount of money from the bonus. They aren’t going to be targeted for their bonus that’s in the bank. Plus the og comment didn’t mention this, making it still a wrong take.

      • Aniki 🌱🌿@lemm.ee
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        9 months ago

        Shame is a powerful motivator for behavior change. It’s also a shame we don’t use it anymore and instead hide behind computer screens.

    • GBU_28@lemm.ee
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      9 months ago

      Woah, do you actually believe earning more means you’ll be taxed cruelly? Actually, you are only taxed more on the income FROM that bracket. Not all income the same

    • intensely_human@lemm.ee
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      9 months ago

      Could end up calibrating someone’s “earning potential” super high for the sake of calculating child support.

      But couldn’t most of these be avoided by structuring the bonus as some sort of annuity?

    • shalafi@lemmy.world
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      9 months ago

      OK y’all, fine, OP’s higher tax bracket take is off target. But if you’re suggesting sudden and massive wealth increases for these employees? Yeah, that’s kinda fraught.

      https://old.reddit.com/r/AskReddit/comments/24vo34/whats_the_happiest_5word_sentence_you_could_hear/chb38xf/

      OP makes some discussion worthy points. And I agree, sit on the reserves as cash and think on it. Meanwhile, nothing leads me to believe Pocketpair isn’t doling out fat bonus stacks. They’re private, they’re not advertising compensation and it’s none of your business.

      I work for a software dev in America, we get fat bonuses every year, on top of what’s guaranteed, because we keep making more than anticipated.

      On top of that, imagine having “developed Palworld” on your resume. Jesus. Golden ticket there.

      tl;dr: Most small companies and individuals are not prepared for this sort of success. Sudden influxes of cash must be navigated carefully.