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Musk’s $5.7B Mystery Gift Went to His Own Charity
- bradhe 4y agoshocking. /s
- agluszak 4y agohttps://archive.md/zJVM9 https://archive.md/zJVM9
- baxtr 4y ago
- coliveira 4y agoWhat a big "gift". It is obvious he need ways to avoid paying taxes after selling so many shares of Tesla.
- deleted 4y ago[deleted]
- hef19898 4y agoOnce the banks behind the Twitter acquisition want their money back, the tax problem will go away...
- 93po 4y agoAvoiding paying taxes by spending even more money that he can no longer use for himself? There is no way to financially come out ahead by donating to charity.
- coliveira 4y agoYou didn't think this through. There is little charity in a private foundation: besides the immediate tax breaks the billionaires receive, the foundation is required to spend only 5% of its endowment on things that are remotely related to charity. The rest of the money is used like always: to buy assets, like stocks. These assets are in practice still controlled by the owner of the foundation. For example, Gates has for decades used his billions to invest in biotech that will ultimately benefit his personal investments. And I'm not event talking about the political power you can buy with your "charity giveaways".
- 93po 4y agoLet me get this straight. Elon donated $6 billion in Tesla shares to his non-profit... so that his non-profit could buy Tesla shares to prop up his stock price? This makes zero sense.
- coliveira 4y agoHe will get a tax break and he doesn't even need to sell the shares immediately. And he still controls the shares through the foundation, just for starters. Don't you think this is a sweet deal? Every aspect of the "charity foundation" created by billionaires is designed to benefit them the most. If I told you that you can control your wealth, diversify your holdings, and pay only 5% of assets per year (in the way you personally decide) instead of 15%, 20%, or 25% in taxes, would you think it is a good or bad deal?
- 93po 4y agoControlling the shares through the non-profit means nothing. He has control even without those shares, and the only difference is that they're now permanently gone as an option to sell and profit off of. You still call this "controlling your wealth" but it's literally the opposite - that $6 billion is now extremely limited in what it can do now in terms of selfish goals.
- coliveira 4y agoIncorrect. Elon still controls everything he puts on his foundation, and when he's gone he will appoint people to control it. That is a fact. He can still sell those shares (without paying taxes) and diversify his holdings if necessary. He can invest in other companies using that money to help him achieve his goals. It is just a bunch of money that he can control in several ways. You just don't have great imagination, but Elon and his lawyers know what is possible.
- binarymax 4y agoA tax avoidance scheme which also placated a twitter argument about his contributions. Unsurprising.
- wsc981 4y agoEvery ultra-wealthy person has a charity for this purpose, right? Clintons, Bill Gates, etc...
- moonchrome 4y agoGates foundation actually does charitable work from what I can tell ?
- nailer 4y agoYep so do Musk and Zuck's charities.
- HDThoreaun 4y agoMusk's foundation does effectively no charity work. Gates foundation is donating 100x as much per year.
- wsc981 4y agoInvests in vaccine companies (Bill Gates stating it was his most profitable investment ever) & major funder for WHO (who’ve been pushing COVID vaccines). Might be a conflict of interest here.
- wsc981 4y agoPS: most foundations are probably required by law to do a little bit of actual charitable work, but I believe these foundations are mainly tax exempt investment vehicles and a way to peddle influence with governments.
- Melting_Harps 4y ago> Gates foundation actually does charitable work from what I can tell ? Than your purview of 'charitable' work includes coaxing Oxford to not open source vaccines to the developing World in order or profit from the largess that big pharama reaped during the pandemic [0] and subsequently caused a lot of unnecessary deaths? That isn't even including their aggressive consolidation of arable farm land in the US with clear ties to large pharma and chemical corps under the auspices of their foundation and ties to the WHO. And I'm not even going to delve into the Epstein relationship Bill had which included trips to pedophile island. If so, you should really look into what you deem as 'charitable work' tbh. 0: https://www.wired.com/story/opinion-the-world-loses-under-bill-gates-vaccine-colonialism/ https://www.wired.com/story/opinion-the-world-loses-under-bi...
- beckingz 4y agoThe classic billionaire tax move. Donate money to your own foundation to work on things you want while getting a big tax break.
- ceejayoz 4y agoDonating $5.7B to save an absolute max (37% tax bracket; he's probably much lower with most income via capital gains) of about $2.1B in taxes doesn't make financial sense, unless you've got a plan to siphon off at least $3.6B tax-free out of the charity. Why do people think a $1B donation saves $1B in tax?
- Quarrelsome 4y agoit only doesn't make sense if you plan to individually spend that money on yourself. However once you have billions of dollars it becomes relatively difficult to spend that much on yourself. Therefore it becomes a place to spend money enacting the change on society that you want to see.
- ceejayoz 4y agoSure, but that's a different motivation entirely.
- ClumsyPilot 4y agoThat money doesnt dissapear - it is still avaliable for lobbying, hiring staff and doing many other things.
- illegalmemory 4y agoOr funding research projects that will benefit you indirectly
- bena 4y agoYes, but the charity can pay for things for him. He needs to go to Europe and do "charity business", the charity can charter a jet for him, pay for his expenses, etc. Even better if he owns the jet, then he can essentially charter his own jet and have the charity cover the fuel and maintenance for that trip. That $5.7B is still effectively his, untaxed.
- c22 4y agoIf I had money to donate I'd donate it to the charity I thought would be most effective at helping the cause I cared most about. If I had enough money to create my own charity it would be focused on the cause I cared most about. My giant ego and hubris would make it hard for me to come to the conclusion that a charity I created wasn't the most effective at its goals, even if that didn't happen to be the case.
- teekert 4y agoThis, I mean why created anything than the charity with most value in your personal view. This just signals he has faith in his own charity.
- brookst 4y agoAll true and a perfectly valid model. But also try: If I were incredibly wealthy and obsessed with running the score up, I’d see any taxes or other loss of wealth as a threat to my ego. If my tax accountants came to me and said I could have a greater net worth by founding a charity optimized for my personal benefit, I’d happily shuffle money there rather than paying taxes. I think that’s also a valid model. I don’t have enough info to have a strong opinion, but my priors on Musk make me at least question what he’s optimizing for.
- c22 4y agoI think he's probably optimizing for both. Don't hate the player, hate the game.
- SketchySeaBeast 4y agoPor que no los dos?
- s1artibartfast 4y agoIts not a feature, it is a bug. You don't have to hate either.
- heartbreak 4y ago
- kodyo 4y agoWait until they hear about what Bill Gates does these days.
- jansan 4y agoIt's strange that the more Bill Gates donates, the richer he gets-
- blitzar 4y agoThe secret Bill and Melinda Gates Foundation ... I have been doing some digging (citizen journalism) and you will never believe who is behind it ...
- sixQuarks 4y agoPeople should research how the Bill Gates foundation has given nearly $400, million to media organizations, organizations that will never say a bad word about gates. The man is literally bribing media companies, but go ahead and believe that it’s Elon who is the evil one
- micromacrofoot 4y agoMost people who are angry about one are angry about the other too, everyone knows it's a tax avoidance scheme
- progrus 4y ago
- user_named 4y agoDo it yourself.
- thinkmcfly 4y ago
- progrus 4y agoMusk derangement syndrome is now an epidemic.
- thinkmcfly 4y agoAn epidemic you say? We should do nothing about it then. I'm healthy, it won't hurt me. There was a poll that showed that people worried about Elon syndrome epidemic are actually the most likely responders to be biased in their decision making. I'll post a link to it when I get out of the shower
- progrus 4y agoA lot of people sound worried about all this, and I’m not one of them. This meltdown is great news. Twitter is still working. The next drop of files will probably start another scandal about COVID censorship. I wonder how many folks all over the world are looking at this and thinking “we could probably fire most of our government”?
- user_named 4y agoAlways the grifter.
- jasmer 4y agoTax optimizations. I have no problems with this, legit things can be done under charitable umbrella, and we should be thankful for the donations. (Massive paintings of oneself on oil canvas notwithstanding ... ahem ... Mr. 'President') But it's the insufferable populist hypocrisy of it all! Please let's just talk and report about it for what it is. The press might even want to use the term 'NGO' where applicable, irrespective of the PR spin of the non-profit 'charity'.
- primitivesuave 4y agoThis reads like a hit piece, and a poorly executed attempt if so. This is standard practice and not uncommon. If we’re going to excoriate billionaires for putting their name on a foundation, shouldn’t Gates, DeVos, and others also be held to the same scrutiny? The article throws in an SBF comparison simply because both parties support the same brand of altruism.
- user_named 4y agoIt's reporting facts.
- sixQuarks 4y agoAgreed. Also it’s not like Musk was going around saying look at me. I donated 5.7 billion to charity. The hive mind is ridiculous
- brookst 4y agoWhen we’re talking about billionaires and nonprofits and taxes, I’m having a hard time seeing how one’s opinions could hinge on public statements rather than the money and impact.
- omgsean 4y ago>If we’re going to excoriate billionaires for putting their name on a foundation, shouldn’t Gates, DeVos, and others also be held to the same scrutiny? Yes.
- primitivesuave 4y agoI actually agree with you here- my point being that I’d be far more compelled by research into overpaid administrators, short-sighted donations, etc. Would be keen to read an article where the $500k yearly salary of the charity’s CEO is examined (this is the case for most major charities looking for “the cure”)
- turmeric_root 4y agoyes
- andreygrehov 4y agoRegular mortals maximize their 401k contributions, use Backdoor Roth IRA, FSA, optimize for long-term capital gains, etc. Is this all legal? Absolutely. The point is - nobody likes paying taxes - people try to minimize whatever it takes. Billionaires do the same. Instead of opening Flexible Spending Account, they start a charity. Instead of using Roth IRA loophole, they start off-shore corporations. Basically, they do pretty much the same what you do, but on a different scale.
- anderber 4y agoThey seem pretty good at getting their taxes down to zero, while us mere mortals have to be happy with deductions.
- maerF0x0 4y agoMere mortals are often paying 0 tax on their investments(ie deferred). Same as the ultra wealthy do. The issue is being a W2 wage slave, err i mean employee
- aisengard 4y agoActually, mere mortals pay tax eventually when they cash out their investments to pay for the things they want. The wealthy get to take low-interest loans against their investments to pay for the things that they want, without ever having to cash out. They never have to pay those taxes, and their inheritors don't either due to the truly insane cost basis step-up benefit you get when assets are transferred to next of kin upon death.
- sokoloff 4y agoThe cost basis step-up is not insane, IMO. It's partly practical ("how am I going to find out the date purchase and basis of some shares my grandfather bought in an account that was doing dividend reinvesting?!"), and partly to avoid unexpected outcomes ("grandpa gave the house to Alice and the rest of his estate to Bob"; if capital gains were due on the house, would Alice have to pay them or would Bob?). IMO, the basis should be as of the date of death, with any taxes due owed from the estate, not the heirs. (It's also fairly difficult to repeatedly exploit this as a loophole, as you have to die to take advantage of it. If we're looking to close loopholes, ones that can be repeatedly applied might be more fruitful places to start.)
- pupperino 4y agoFascinated by the sheer amount of emotional reactions here.
- deleted 4y ago[deleted]
- fredgrott 4y agoNot a real brilliant long-term move. Why? Tesla's premise is that they can balance not having large revenues in manufacturing for a period of time to build out the EV industry as Tesla's major revenue is in fact carbon tax credits. The problem is the competition is far greater in resources than Elon has guessed and that will tend to blind-side soon. Or in short words, Elon is spending stuff he no longer in the future has.
- 93po 4y ago> Tesla's major revenue is in fact carbon tax credits Why are you outright lying and spreading misinformation? It's very easy to search online and see that their sale of carbon credits is, at most, a few percent of their total revenue over the past 5 years. I actually did the math and it was 2.4%
- codeulike 4y agoSo in the same way that Bill Gates donates to his own foundation? https://www.cnbc.com/2022/07/13/bill-gates-donates-20-billion-to-bill-and-melinda-gates-foundation.html https://www.cnbc.com/2022/07/13/bill-gates-donates-20-billio...
- misiti3780 4y agoand Zuckerberg, and everyone else with a shitload of money
- snowwrestler 4y agoZuckerberg did not set up a charity, in part to preserve its freedom to spend however it wants. The Chan Zuckerberg Initiative is an LLC.
- kgwxd 4y agoMinus the press release.
- DaniloDias 4y ago
- IncRnd 4y agoHere is Bill Gate's Press Release for 2022. "With the support and guidance of our board, we plan to increase our spending from nearly $6 billion per year today to $9 billion per year by 2026. To help make this spending increase possible, I am transferring $20 billion to the foundation’s endowment this month." Jul 13, 2022 [1] [1] https://twitter.com/BillGates/status/1547235386560155648 https://twitter.com/BillGates/status/1547235386560155648
- kgwxd 4y agoYes, OP link was a press release by Gates too. I meant Musk didn't do a press release.
- newbieuser 4y agothe richest troll in the galaxy
- metadat 4y agohttps://archive.today/zJVM9 https://archive.today/zJVM9
- ilrwbwrkhv 4y agoOf course it did. Just how SBF's gifts went towards his own friends and family. Why do people expect anything else I don't understand.
- SanjayMehta 4y agoComparing SBF and Musk does not seem right. For all his faults, Musk has actually created real products. SBF on the other hand seems to have been really good at raising money. Much like Elizabeth Holmes.
- ilrwbwrkhv 4y agoMusk has found his way towards people who created real products. SBF basically didn't have those skills. But they are both grifters.
- jasonlfunk 4y agoInstead of giving directly to charities like St. Judes - he funds his foundation which gives to charities like St. Judes. When you give away $5B, wouldn't it be irresponsible to not give it to a foundation? And if you have your own foundation, wouldn't it be dumb to not give it to your own foundation? This seems like a nothing story; except that it's in vogue to hate Musk right now.
- blisterpeanuts 4y ago
- dmix 4y agoIs Bill Gates still shorting Tesla?
- Graziano_M 4y agohttps://www.cnbc.com/2022/04/23/elon-musk-tweets-that-he-confronted-bill-gates-about-shorting-tesla.html https://www.cnbc.com/2022/04/23/elon-musk-tweets-that-he-con...
- SV_BubbleTime 4y agoI saw a comment that was without irony posting how Musk is the new Trump. And I think there is so much truth to that it’s painful, but not in the way some people may think.
- memish 4y agoOnly insofar that they are anti-establishment and the media uses them for ragebait, and they troll the media. Trump is a rent seeker celebrity. Elon is one of the most productive humans. They are radically different but both break people's brains because they are supposed to be pro-establishment refined elites. Instead they are uncouth and align more with the working poors and dissidents. That's the biggest sin and it's what drives TDS and EDS respectively.
- bryan0 4y agoIf he didn’t try to keep it a secret it would seem totally reasonable. Concealing it makes it seem shady.
- trident5000 4y agoAh, the daily liberals are mad at Elon post.
- ancapsfascists 4y agoThe material improvements he could have gotten for this money... He could have created tens of thousands of homes in apartments and gifted them to municipalities to be social housing, putting a massive dent in homelessness. He could have built and furnished schools. He could have bought public transit vehicles. There's countless things that would have real, immediate, material impact on thousands of lives.
- hbrn 4y agoThere's always somebody out there who knows how other people should spend their money.
- ancapsfascists 4y agoI'm spending mine on reforestation of hundreds of acres of land formerly logged and protecting it into old growth. I also spend mine on offering sliding scale, below market rent to those in need in the house I own. These things provide mutual aid and material benefits to others. Believe me, if I could afford to build apartments, I would be.
- solumunus 4y agoIf you were to do any of those things it would make the most sense to do them through your own charitable foundation... I'm not saying that's what he's going to do with the money, just that reading this story and then responding how you did makes no sense. Half the people in this thread seem to have absolutely zero understanding of what's going on here.
- ancapsfascists 4y agoI'm aware of how trusts and foundations work. Elon Musk has done nothing to suggest he's got charitable intent. The dude is barely one step above a con man, egomaniac, and compulsive liar.
- nemo44x 4y agoIt's amazing how many coordinated attacks there are against Elon Musk. He's clearly changing minds in ways that many media people don't like. Losing control of the narrative must feel existential.
- chung8123 4y agoWhen people talk about taxing billionaires this is where we should focus. Stop the tax deductions and they will start paying their fair share.
- throwaway4199 4y agoSeeing lots of confusion on here so: I put 15% of a mid-8-figure startup exit into a private foundation, AMA
- uplifter 4y agoIs calling it a charity accurate? It is a 501(c)(3) non-profit, but not the “public charity” subtype, rather it is the “private foundation” type[0]. [0] https://www.influencewatch.org/non-profit/musk-foundation/# https://www.influencewatch.org/non-profit/musk-foundation/# [1]Types of 501(c)(3) orgs: https://quickbooks.intuit.com/r/starting-a-business/understanding-the-different-types-of-501c3-non-profit-organizations/ https://quickbooks.intuit.com/r/starting-a-business/understa...
- greenhearth 4y agoHe is an obscene abomination.
- blisterpeanuts 4y agoSarcasm?
- greenhearth 4y agoNo, my friend. This man is quite a burden on the collective consciousness.
- verytrivial 4y agoWhat I personally don't understand is why everyone is still trying to draw moral conclusions about how this man's words align with his actions. It's a complete waste of time.
- yabones 4y agoHighly recommend the book "Dark Money" by Jane Mayer to understand the charity-to-PAC pipeline that exists in the US .01%'ers. Billionaires hate paying their taxes, so when they're forced to they divert their money into a 501(c)(3) or (4) that they're in control of, and use the 95% of non-charitable funds to do their dirty work, and the 5% of charitable funds to create academic environments that support their goals.
- augasur 4y agohttps://archive.vn/zJVM9 https://archive.vn/zJVM9
- hot_iron_dust 4y agoIts interesting how Elon Musk became a target of large media outlets' attacks since he de-facto entered US and world politics. The way he entered it is novel and technological. Fascinating to see how this story unfolds further.
- richbell 4y agoThat's his preferred narrative. The truth is that Elon Musk has been subject to negative attention for years because of market manipulation[0], abhorrent labour practices and safety record[1], and obsession with inserting himself into the limelight via poor behaviour[2] or over-promising things he can't deliver[3][4] — to name a few reasons why he's viewed unfavorably. [0] https://www.sec.gov/news/press-release/2018-219 https://www.sec.gov/news/press-release/2018-219 [1] https://www.forbes.com/sites/alanohnsman/2019/03/01/tesla-safety-violations-dwarf-big-us-auto-plants-in-aftermath-of-musks-model-3-push/ https://www.forbes.com/sites/alanohnsman/2019/03/01/tesla-sa... [2] https://www.theguardian.com/technology/2018/jul/15/elon-musk-british-diver-thai-cave-rescue-pedo-twitter https://www.theguardian.com/technology/2018/jul/15/elon-musk... [3] https://www.businessinsider.com/elon-musk-tesla-ventilator-controversy-explained-2020-4 https://www.businessinsider.com/elon-musk-tesla-ventilator-c... [4] https://jalopnik.com/elon-musk-promises-full-self-driving-next-year-for-th-1848432496 https://jalopnik.com/elon-musk-promises-full-self-driving-ne...
- 93po 4y agoWhere's the equal or louder negative attention for billionaires who profit off death and destruction? That use actual slave labor for their projects that result in tens of thousands of deaths? That wreck the environment without consequence? That promote harm and violence to disadvantaged groups? That exploit child labor? The issue is clearly not that Musk says dumb shit on Twitter and missed a deadline for his pickup truck. The issue is that society has a rage boner against him and people like you are perpetuating it while missing the wealth inequality forest for the Elon trees.
- richbell 4y ago> Where's the equal or louder negative attention for billionaires who profit off death and destruction? That use actual slave labor for their projects that result in tens of thousands of deaths? That wreck the environment without consequence? That promote harm and violence to disadvantaged groups? That exploit child labor? The sad reality is that these egregious human rights violations often fly under the radar because their perpetrators know how to keep their mouths shut. Elon is constantly in the limelight because he intentionally inserts himself there and is openly flaunting his wealth and disrespect for others. It's no surprise that a high-profile person constantly acting belligerent, lying, and antagonizing people receives so much attention from the media. It's the same reason why Martin Shkreli went to jail and not any of the pharmaceutical executives who've ruined or ended millions of lives. > The issue is clearly not that Musk says dumb shit on Twitter and missed a deadline for his pickup truck. This is an inaccurate and dishonest summary of what I linked in my comment. > The issue is that society has a rage boner against him and people like you are perpetuating it while missing the wealth inequality forest for the Elon trees. You are creating a false dichotomy to simp for a billionaire who treats his employees and other people around him as disposable means to an end. The sins of other people does not make it okay for Elon to sexually harrasses and abuses his employees, report a fake shooting threat to spite someone for whistleblowing[0], abuse and kill countless animals in rushed and botched testing... I could go on. [0] https://www.bloomberg.com/news/features/2019-03-13/when-elon-musk-tried-to-destroy-tesla-whistleblower-martin-tripp https://www.bloomberg.com/news/features/2019-03-13/when-elon...
- ergocoder 4y ago/r/accounting has a thread about this. https://www.reddit.com/r/Accounting/comments/zlunm5/tax_question_is_this_a_thing/ https://www.reddit.com/r/Accounting/comments/zlunm5/tax_ques... It is nothingburger... unless the charity is shady.
- fareesh 4y agoHillary Clinton - Clinton Foundation = Good Barack Obama - Obama Foundation = Good Bill Gates - Bill & Melinda Gates Foundation = Good Mark Zuckerberg - Chan Zuckerberg Foundation = Good Warren Buffet - Buffet Foundation = Good ELON MUSK SATAN'S ACOLYTE WHO WROUGHT UPON THE WORLD THE REMOVAL OF HEAVENLY DAUGHTER VIJAYA GADDE NOBLE DEFENDER AGAINST THE LIES OF THE DRUMPF = Mystery foundation = EVIL The overall zeitgest is just reaching because he is saying heterodox things.
- the_only_law 4y agoIt’s ok, you don’t need to have an emotional outburst. Try taking a breather.
- richbell 4y ago> Hillary Clinton - Clinton Foundation = Good Barack Obama - Obama Foundation = Good > Bill Gates - Bill & Melinda Gates Foundation = Good > Mark Zuckerberg - Chan Zuckerberg Foundation = Good > Warren Buffet - Buffet Foundation = Good > ELON MUSK SATAN'S ACOLYTE WHO WROUGHT UPON THE WORLD THE REMOVAL OF HEAVENLY DAUGHTER VIJAYA GADDE NOBLE DEFENDER AGAINST THE LIES OF THE DRUMPF = Mystery foundation = EVIL > The overall zeitgest is just reaching because he is saying heterodox things. This is a vapid comment. Other billionaires' charitable foundations and ventures are regularly scrutinized and criticized — hell, there's a rather large subset of Americans that believe the Clinton Foundation is a cover for clandestine operations.
- fareesh 4y agoIt's a comment on the timing which this reply does not address
- micromacrofoot 4y agoThey're all bad Trump's foundation was actually misusing funds though, they lost the trial.
- ulrashida 4y agoThe public perception difference is quite easy to see. Compare these two statements: 1. "I gave $5B to charity" 2. "I gave $5B to my charity" That they're both charities does not wash away the feeling that one of them is a bit less selfless than the other.
- blisterpeanuts 4y agoBill and Melinda Gates Foundation would also be "my charity", would it not? Or are you distinguishing between foundations and direct recipients of charitable donations?
- ulrashida 4y agoYou're correct, it would be. However, when the Gates' donations are disclosed they tend to say "$xB was given to the Gates Foundation" while Musk's was apparently "donated to a charity". (Note: I do not follow this topic regularly, this conclusion was based on some basic searches.) To dig a bit deeper, it could be argued that the contributions and outcomes of the Gates' foundation are relatively well known at this point while Musk's outcomes are less so.
- 93po 4y ago> while Musk's was apparently "donated to a charity". Musk made no public announcement about this and declined to comment when asked about it. He wasn't trying to score social media points by suggesting he was about to cure cancer. This became public knowledge when he was legally required to report it to the SEC. Gates on the other hand loudly announces all of his contributions.
- neelkadia 4y ago"I want to have as much as money I can hold legally by WHATEVER means." Charity? What's that?
- pwarner 4y agoYou can get the same tax loophole! https://www.schwabcharitable.org/non-cash-contribution-options/maximizing-tax-benefits-by-bunching-contributions https://www.schwabcharitable.org/non-cash-contribution-optio... If you have appreciated stock, transfer it into a DAF, realize a large tax deduction to offset a high income year, and take the standard deduction other years.
- seanp2k2 4y agoWhy is this flagged? Does Musk have admin pull on HN too?