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> Would Thiel have been willing to sell his shares to someone else at $0.001 at the time he put them into the IRA? Because that's ultimately what market value i

> Would Thiel have been willing to sell his shares to someone else at $0.001 at the time he put them into the IRA? Because that's ultimately what market value is about. Well... no. (Can't believe I'm defending Peter F-ing Thiel) I might own some AAPL shares that I think are worth $1000/share--so I'm not willing to sell my AAPL shares for less than $1000 each. The market (today) thinks they are worth $133/share. Who is right? Thiel might have really truly believed that his 2M shares would be worth a few billion dollars one day. But if you can't find anyone who is willing to buy them for that price, then it doesn't matter. The "fair market value" (what the IRS cares about) of those shares is not a few billion dollars. It doesn't become a FMV until you can find an arms-length buyer who is willing to buy the shares for that price. You could pay someone to create an independent valuation of the shares--but for a brand new company that has no employees and no assets, not even IP, why would you expect the valuation to come back at much more than $2k?

didibus 5y ago
> PayPal later disclosed details about the early history of the company in an SEC filing before its initial public offering. The filing reveals that Thiel’s founders’ shares were among those the company sold to employees at “below fair value.” The article implies 0.001$ was below fair value based on PayPal's own declaration at the IPO. That's why. In any case, I think this is unimportant, the important question is can a founder always transfer their owning shares into a tax advantaged Roth IRA? Does this make sense to permit? If I start a company today and just buy my shares into my Roth IRA before I even write a single line of code or hire anyone, so that if my startup grows all my owning shares of it are tax exempt. And if it does, to what extent? Should there be no cap? In reality it's all just a political question, who should pay taxes, how much, and in what circumstances. Articles like this I think help people understand and think through some of the edge cases around that, to better allow them to form an opinion on it.

didibus 5y ago

> PayPal later disclosed details about the early history of the company in an SEC filing before its initial public offering. The filing reveals that Thiel’s founders’ shares were among those the company sold to employees at “below fair value.” The article implies 0.001$ was below fair value based on PayPal's own declaration at the IPO. That's why. In any case, I think this is unimportant, the important question is can a founder always transfer their owning shares into a tax advantaged Roth IRA? Does this make sense to permit? If I start a company today and just buy my shares into my Roth IRA before I even write a single line of code or hire anyone, so that if my startup grows all my owning shares of it are tax exempt. And if it does, to what extent? Should there be no cap? In reality it's all just a political question, who should pay taxes, how much, and in what circumstances. Articles like this I think help people understand and think through some of the edge cases around that, to better allow them to form an opinion on it.