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Elon Musk says he’ll pay over $11 billion in taxes this 12 months

Elon Musk, CEO of Tesla, stands at the building website of the Tesla Gigafactory. In Grünheide close to Berlin, September 3, 2020.

Patrick Pleul | image alliance | Getty Photographs

Elon Musk faces a hefty tax invoice this 12 months — in all probability the largest in U.S. historical past.

“For the ones questioning, I can pay over $11 billion in taxes this 12 months,” the Tesla CEO tweeted on Monday.

That is on the subject of a CNBC estimate that Musk used to be set to pay a complete of $12 billion in taxes in 2021.

Musk has offered off $14 billion value of Tesla inventory since early November, after asking his fans in a Twitter ballot if he will have to promote 10% of his holdings. The reaction to that ballot used to be a powerful “sure.”

However it is most likely Musk would have begun promoting anyway. That is as a result of he faces a large tax invoice on Tesla inventory choices.

Inventory choices Musk used to be awarded in 2012 are set to run out in August subsequent 12 months. With a view to workout them, he has to pay source of revenue tax at the acquire.

Relatively than take a wage or money bonus, Musk’s wealth comes from inventory awards and good points in Tesla’s percentage value.

Even though Tesla stocks have taken a tumble since Musk’s Twitter ballot, they continue to be extremely precious — the inventory is up 28% year-to-date.

When Musk desires money, he can merely borrow cash the usage of his corporate’s inventory as collateral. Alternatively, this tradition has been criticized by way of some politicians as a tax loophole for the mega-rich.

Previous this 12 months, ProPublica printed an investigation appearing Musk and a number of other different billionaires paid no federal source of revenue taxes in 2018.

Between 2014 and 2018, Musk paid $455 million in taxes on $1.52 billion of source of revenue, in keeping with ProPublica, in spite of his wealth rising by way of $13.9 billion over that duration.

In line with Forbes, Musk is value over $244 billion on paper, making him the arena’s richest guy.

Musk will have waited till subsequent 12 months to pay the tax invoice, however that might have intended probably getting hit by way of upper tax charges beneath the Democrats’ Construct Again Higher invoice.

The Tesla and SpaceX leader has been sparring with outstanding Democrats on Twitter in recent years over the problem of tax avoidance.

Closing week, he fired again at Senator Elizabeth Warren after she puzzled Time Mag’s choice to call Musk its Particular person of the 12 months, tweeting: “I can pay extra taxes than any American in historical past this 12 months.”

And if Musk does finally end up paying the massive sum he mentioned he would, there is a probability he could also be proper.

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