Elon Musk Revealed The Huge Amount He’ll Pay In Taxes This Year
Elon Musk publicly revealed just how much he will have to dole out in taxes this year.
This article is more than 2 years old
In early November Elon Musk posted a poll on his Twitter account asking his followers if he should sell off his Tesla stock. Shortly after, Musk made headlines for repeatedly selling sizable portions of his shares in Tesla. Even though Musk positioned the tweet in such a way that would indicate he let the public decide the fate of his stocks, the richest man in the world and newly christened Person Of The Year, had, in fact, made plans to do so much earlier, the overarching reason as to why was so he could satisfy income tax obligations dating back to 2017. Now, according to the BBC, Elon Musk has come clean about just how much his taxes will cost him this year.
On December 19th Elon Musk tweeted that he will have to fork over a total of $11 billion in taxes owed. Some have speculated that Musk decided to post the revealing tweet in response to public criticisms that arose from former presidential candidate and Democratic Senator Elizabeth Warren. Warren tweeted earlier in the week “Let’s change the rigged tax code so ‘The Person of the Year’ will actually pay taxes and stop freeloading off everyone else.”
While Elon Musk has established that he will in fact dole out a hefty chunk of change to satisfy his taxes this year, Warren’s criticism does not come out of a vacuum. According to CNN, for decades the ultra-wealthy have successfully exercised legal loopholes to completely avoid paying any amount in taxes. This is largely because the super-rich live off of dividends from their stocks instead of paying themselves an annual salary. The reason why Musk is paying a sum extracted from taxable income this year is because he is exercising stock options that were set to expire in August of 2022, had he not elected to exercise those options, he would have lost the opportunity to do so.
Warren’s critique of Elon Musk, and the ultra-wealthy in general, via her Twitter account, come on the heels of the stalwarts that President Biden has been facing in Congress as he fights to tweak the laws that have allowed the 1% to circumnavigate the United States’ tax system as well as increase viable taxability on their held assets. At this point, it still remains to be seen whether any portion of President Biden’s agenda will pass at the congressional level.
Elon Musk, on the other hand, while he will be paying out the $11 billion to the federal government and to Tesla’s current home state of California is already taking preventative measures to decrease the amount of money he will have to dish out in the future. In October, Elon Musk announced that Tesla would be officially moving its headquarters from Palo Alto, California to Austin, Texas. The move is advantageous for both Tesla and Musk because Texas is one of the few states that does not charge state income tax. Additionally, because of the immense influx of new businesses that the state has seen in recent years, it has been offering sizable discounts on property tax rates. Thus it looks like Elon Musk will be able to continue to negate the amount of taxes he’s forced to pay in at least the foreseeable future.
