26 ms·

1. banks loan elon money 2. elon uses this money to buy twitter

• laichzeit0 4y ago
  3. Elon pays banks interest each month for said loan money 4. Interest is cheaper than tax Elon would pay if he sold those shares instead of borrowing against them.
  • skinnymuch 4y ago
    4 is true but doesn’t show how insane of a diff it is. The interest is going to be tiny. It isn’t going to be 3% like what Robinhood charges for any one with at least $2K in Robinhood and $5/mo membership. If Elon is getting sub 1% interest rate. AND he gets to tax deduct that interest. It’s near nothing.
  • kjksf 4y ago
    Re 4: Musk doesn't avoid the tax, merely delays it. By the time he has to pay it he'll also have to pay tax on the accumulated interest. He'll pay the interest AND the tax on the principal AND the interest.
  • voldacar 4y ago
    With 4, the more significant factor is not tax avoidance, but the fact that selling 21B$ of shares in a short period would really tank the stock price. the negative effect of that would be more significant than capital gains tax