Elon Musk, founder and CEO of Tesla, donated a total of more than 5 million shares of the world’s most expensive automaker to charity between November 19 and 29. The name of the charity was not disclosed.
The donation was worth $5.7 billion, or more than 5 billion euros, based on the closing prices of Tesla shares in the five days he donated the shares. Late last year, the billionaire sold $16.4 billion worth of stock after he took a Twitter poll asking if he should sell a tenth of his stake in Tesla.
He also tweeted that he will have to pay more than $11 billion in taxes in 2021 to exercise his stock options. It would be one of the largest payments to the US tax authorities ever.
Musk also clashed with US Senators Bernie Sanders and Elizabeth Warren, who called on the wealthy to pay more taxes. According to experts, donating Tesla shares will provide a tax advantage to Musk. This is because shares given to charities are not subject to capital gains tax, as if they were sold.
tax benefits
“His tax benefit would be huge. He would have saved between 40 and 50 percent of $5.7 billion in taxes, depending on whether he could take the deduction from his California income and avoid the income tax he would have to pay if he sold the stock.” Tax attorney Bob Lord said. Also, according to Lord, Musk will likely transfer the shares to intermediaries and not have to donate directly to charities.
Musk’s charitable gestures lag behind other billionaires thus far. Musk and Jeff Bezos, founder of Amazon, donated less than 1 percent of their assets, while other billionaires like Warren Buffett and George Soros had already given up more than 20 percent of their assets by early September, according to Forbes magazine.
Watch our news videos in the playlist below:
Unlimited free access to Showbytes? And that can!
Sign in or create an account and never miss a thing from the stars.
