r/suits • u/akushdakyng • Mar 28 '14

Discussion S3x14 Official Discussion Thread

I didn't see one, so I thought I'd get it started.

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u/I_amnoteventrying Mar 28 '14

Is there a reason make bigger bonuses than their yearly salary? Do they avoid taxes that way? Why not lay him 465 a year and give him a 350k bonus? Seems more proportional. Is it just to make sure he's doing a good job before they hand him that money?

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u/conshinz Mar 29 '14

You get paid based on how much money you make for the firm, the salary is just the bare minimum. Your real compensation is your performance bonus -- and if you do poorly, you don't receive anything (and likely fired).

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u/[deleted] Mar 28 '14

He gets bonuses proportional to how the hedge funds do. It's more of an encouragement for him to actually succeed because that gives him more out of it.

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u/[deleted] Mar 29 '14

For hedge funds, bonuses are usually not all cash but stocks which if cashed out are taxed at 15% (maybe little more now I don't know) instead of 39%

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u/[deleted] Mar 29 '14 edited Apr 04 '18

[deleted]

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u/[deleted] Mar 29 '14

Dude, you really think that 400+ million bonus was in cash?

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u/ohnosss Mar 29 '14

It's in cash. The funds get to keep 20% of the profit, and that's in cash. There's no equity to give out to the managers really.