There have been recent allegations that Elon Musk doesn’t pay his taxes. Most people know him as a significant founder of Tesla, SpaceX, and the Boring Company. But he also owns about $10 billion worth of Bitcoin and Ether in addition to being an investor on many other blockchain projects. How does a man who is powerful enough to create companies like SpaceX end up paying so little for themselves?
Elon Musk is a billionaire CEO of Tesla, SpaceX and PayPal. He also doesn’t pay taxes. In fact, he has never paid taxes in the United States. Read more in detail here: elon musk tax bill 2022.
Elon Musk is often chastised by lawmakers and opponents for not paying his fair share of taxes. Senator Warren, for example, often claims that Elon paid no taxes in 2018. Elon Musk, though, is not alone. The vast majority of the country’s billionaires pay little or no income tax.
With a caveat, $0 Salary With a Caveat Salary
Many followers of Elon Musk argue that he is an excellent CEO and leader since he does not accept a salary. Elon Musk owns Tesla, SpaceX, the Boring Company, and Neuralink (Twitter) and receives no compensation. However, the main reason is to avoid paying taxes.
Salaries are paid to everyone, from lowest wage laborers to high-paid CEOs. When someone receives a wage, federal, state, and local income taxes must be paid. Depending on the income bracket, state, and location, the overall tax might be as high as 55 percent.
Elon does not accept a salary to avoid these taxes. Elon, on the other hand, does not work for these corporations for free. He receives his pay and perks in the form of company stock and stock options. According to federal regulations, income tax is only due when the equities are sold. Elon pays no income tax since he isn’t selling everything in his holdings.
The Warning
However, how would a person support his lifestyle if he does not get a wage from his job? Tesla and SpaceX have spent all of their money on Elon Musk.
Elon has a number of private planes. Those planes are either Tesla or SpaceX registered. As a result, Tesla and SpaceX are responsible for all expenditures associated with the planes, including purchase, maintenance, fuel, insurance, pilot salaries, and meals.
Furthermore, Elon Musk and his family own a number of automobiles. Tesla and SpaceX are responsible for all costs associated with such vehicles. As a result, Elon spends and requires no money for transportation.
Elon Musk famously sold all of his California homes a few years ago. He claims that his worldly possessions prevent him from progressing to a better future. He didn’t purchase any million-dollar mansions in Texas despite moving from California. He is said to reside in a $50,000 home in Boca Chica, Texas. SpaceX and Tesla, on the other hand, cover his housing expenses.
Elon Musk’s residence in Boca Chica is owned by SpaceX. As a result, they purchased the land. They are also responsible for paying property taxes and upkeep.
Elon also rents multiple properties close to Tesla’s offices. Tesla, on the other hand, pays for the rental properties in both Texas and California. As a result, Elon’s housing costs are nothing.
Even the expenditures of meals and entertainment are covered by Tesla and SpaceX’s commercial spending.
Tesla provides health insurance to Elon and his family. That policy provides the most complete medical coverage available. As a result, Elon and his family pay nothing for their medical treatment.
As a result, even though Elon Musk receives no compensation from his firms, they cover all of his transportation, health insurance, and housing expenses.
Elon Musk is one of the world’s most well-known, renowned, and influential individuals. As a result, his and his family’s safety is vital. Elon and his family are well-protected by a private security unit that SpaceX and Tesla have paid for.
The most major expense issues for anybody are housing, health insurance, and transportation. All of this is handled by others for Elon Musk.
Elon Musk’s Tax Bill Is $11 Billion
Elon paid $11 billion in income tax in the year 2021. He did, however, make certain that everyone was aware of it. To counter charges that “billionaires don’t pay their fair share of taxes,” he famously questioned his Twitter followers on whether he should sell Tesla shares to pay taxes. Despite Elon’s efforts to portray the $11 billion tax-paying sagas as a gesture of benevolence, the truth is very different.
Elon obtains a performance-based compensation and incentives in company shares while not receiving a salary from SpaceX or Tesla. Elon was set to acquire more than $20 billion in Tesla shares via option expertise in 2021. This option exercise resulted in a $11 billion tax bill. He had to sell Tesla shares to make it happen. Many people are unaware that following this deal, Elon ended up with more Tesla stock.
The charge that Elon paid no taxes in 2018 is true, but it’s misleading. It’s not a lie, but deceit since the complete truth is left out. Due to a clerical mistake, Elon overpaid his federal taxes in 2017. As a result, he carried over his earlier tax payment into the 2018 tax season. That’s why he didn’t pay any taxes in 2018.
Billionaires and corporations are all the same.
Elon isn’t by alone. Despite doing trillion-dollar business, most billionaires like Mike Bloomberg, Jeff Bezos, Warren Buffet, firm CEOs and executives, and corporations like Amazon, Apple, and Facebook do not pay federal taxes.
Apple, Facebook, Tesla, and other corporations, for example, never bring their offshore money to the United States. They set up dummy corporations outside of America and funnel the money via them. All proceeds are also kept in offshore bank accounts. As a result, the US government is unable to collect any taxes.
Another tax avoidance tactic is used by these businesses. The majority of multinational corporations are registered in tax havens. If Apple, for example, needs money, they may borrow it from that offshore business. Despite the fact that Apple established that offshore corporation, pursuant to different laws and regulations, the federal government is obligated to offer Apple a tax benefit. For example, even if Facebook makes billions of dollars in ad income, they may still claim to be a loss-making firm because of a tax loophole.
Conclusion
A healthy, happy, and inexpensive existence does not need billions of money. All other expenditures are negligible after housing, health, and transportation requirements are satisfied. A few million bucks will suffice. In the instance of Elon Musk, Tesla and SpaceX cover all of his expenses. As a result, he receives no wages and pays no taxes.
Elon Musk is a billionaire entrepreneur who has been in the news for many different things. He is often called “the real-life Tony Stark” because he runs multiple companies, including Tesla and SpaceX. However, despite his success, he doesn’t pay taxes. In fact, according to a recent investigation by ProPublica, Musk has never paid any federal income tax on the billions of dollars that he’s made over the years. Reference: elon musk taxes propublica.
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