This started at the same time that top-tier income tax rates were brought down from their 93% peak in the late 1950s. Turns out that when you find yourself above that line, you take efforts to actually spend money on things you can deduct, rather than buying up shares that you can’t deduct. When you find yourself $10,000 over the line, and you’re told to send $9,300 to the IRS, you tend to say “Well, fuck that, I’d rather pay out $10,000 to the guys who brought me here, rather than $9300 to the tax man. The good will I get from that bonus is worth a lot more than the $700 the IRS is going to let me keep.”