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Zuckerberg Answers Critics of His Move To Give Away His Facebook Stock (facebook.com)
An anonymous reader writes: Mark Zuckerberg's announcement that he and his wife are giving away $45 billion worth of Facebook stock garnered a lot of praise and a fair bit of criticism. The Facebook CEO answered some of the apprehension in a post that reads in part: "By using an LLC instead of a traditional foundation, we receive no tax benefit from transferring our shares to the Chan Zuckerberg Initiative, but we gain flexibility to execute our mission more effectively. Just like everyone else, we will pay capital gains taxes when our shares are sold by the LLC."
Nothing any corporation does is altruistic.
#DeleteChrome
its his money its his right to do what he wants with it.
if he wanted to get all his money in a pile and burn it, that would be his right. I dont get why people care what others do with their own money
have you seen my sig? there are many others like it but none that are the same
Altruism is a bs word we came up with because we didn't like to admit that we're only nice to others because it feels good.
From this Dec 3, NY Times article How Mark Zuckerberg’s Altruism Helps Himself:
(Why an L.L.C.?)
An L.L.C. can invest in for-profit companies (perhaps these will be characterized as societally responsible companies, but lots of companies claim the mantle of societal responsibility). An L.L.C. can make political donations. It can lobby for changes in the law.
(Why not a charitable foundation?)
... a charitable foundation is subject to rules and oversight. It has to allocate a certain percentage of its assets every year. The new Zuckerberg L.L.C. won’t be subject to those rules and won’t have any transparency requirements.
(Tax implications)
... if the L.L.C. sold stock, Mr. Zuckerberg would pay a hefty capital gains tax, particularly if Facebook stock kept climbing. If the L.L.C. donated to a charity, he would get a deduction just like anyone else. That’s a nice little bonus. But the L.L.C. probably won’t do that because it can do better. The savvier move, Professor Fleischer explained, would be to have the L.L.C. donate the appreciated shares to charity, which would generate a deduction at fair market value of the stock without triggering any tax.
All legal. Don't hate the player, hate the game... (or so I'm told)
It must have been something you assimilated. . . .
And you didn't know that feeling good is a real benefit?
we will pay capital gains taxes when our shares are sold by the LLC
He says that like its a good thing. Honestly I would argue anyone not doing everything they can within the law to optimize their tax situation is doing HARM. The government is only going to use the revenue to kill people on the other side of the world we don't need to be involved with, needlessly spy on us, our friends, and neighbors, and general interfere with the pursuit of life liberty and happiness.
Failing to to minimize your lawful tax burden does not make you some kind of patriot in my book, it makes you part of the problem.
Repeal the 17th Amendment TODAY! Also Please Read http://www.gnu.org/philosophy/right-to-read.html
So you're saying that when Microsoft releases open source code it is ENTIRELY altruistic? Right...
A fool and his hard drive are soon parted.
It's a PR show.
It's like a broken record with you retards. We get it, you are cynical of literally everything because it's an easy way to seem smart.
Not that there isn't plenty in the world to be cynical about, but Zuckerberg is not going to make money off this and will be donating most of his wealth to charity. Shrug.
So if the LLC donates, say, $100M in Facebook stock to a charity, Zuckerberg gives up an asset worth $100M, the charity gets an asset worth $100M, and Zuckerberg writes off $100M because he gave away an asset worth $100M. I'm missing the Crime Against Humanity here.
An interesting anagram of "BANACH TARSKI" is "BANACH TARSKI BANACH TARSKI"
Funny how in a "haters gonna hate" comment, it has a sideswipe at "SJWs" for no apparent reason.
Those who do not learn from commit history are doomed to regress it.
All legal. Don't hate the player, hate the game... (or so I'm told)
Fuck that--I'll sure as hell hate the player for playing the damn game.
is that this is all very likely a smokescreen for his political and lobbying activities. That's why he doesn't just run it as a real charity. Real charities aren't allowed to do the kinds of things Zuckerberg (probably) wants to do. He's going to use this as a very big stick to get things he wants. He's not doing this out of the kindness of his heart.
The only times I can think of when a Baron genuinely turned to charity are at the end of their lives when a few of them got the fear of God (and more importantly hell) in 'em.
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I'm missing the Crime Against Humanity here.
I'm not saying there is one... However, by using an LLC, he gets full control over the stock, w/o any charity rules and/or transparency requirements, until the last moment it's disposed of. On the other hand, the line between shrewd and crime can be narrow and gray - ask any Wall Street banker.
It must have been something you assimilated. . . .
The LLC categorization permits the Zuckerberg Foundation to lobby as much as they want for legislation change, unlike a regular foundation (501c3). In light of Zuckerberg's FWD.US political action committee spending a fortune lying about the "need" for H1B labor, I don't trust this at all. Look, Zuckerberg STOLE the idea for FB; then he LIED to his customers about maintaining privacy; Now his PAC lies about immigration policy. I don't trust Zuckerberg for a SECOND. "Unfriend" this manipulator!!!
TIL Mark Zuckerberg is a "Corporation"
What? Being nice to others is not only emotionally positive but it also makes logical sense.
The golden rule logically allows for a world where you're less likely to run into someone who is bigger and badder and decides to eat you for lunch.
Why go through an LLC? Can't he just sell the stock under his own name when necessary and use the cash for whatever he wants, like a political contribution?
His daughter can speak already?
Have gnu, will travel.
He is donating 99% of his stock over the course of his lifetime. He is only in his 30s right now, and with his wealth we can safely expect him to live at least into his 80s. That is at least 5 decades of donating his stock (to his new company, no less).
One other thing we can count on is that by the year 2065, his stock will be worth a lot less. Facebook is so absurdly overvalued that even pretending his stocks to be worth $45B today is laughable. Eventually the bottom will fall out, just as it did with MySpace, just as it did with AOL, just as it did with CompuServe. He does have plenty of smart financial types around him to protect him as well as possible but eventually it is going to fall like a stone.
If you don't believe it is going to fall, go ask some shareholders how facebook makes money, and how much money they think it makes. I will bet the overwhelming majority of them don't have a clue, they just know that "everyone" uses it and they assume it must be worth money as a result.
Damn_registrars has no butt-hole. Damn_registrars has no use for a butt-hole.
So you're saying that when Microsoft releases open source code it is ENTIRELY altruistic?
No. He is saying it isn't entirely selfish. Altruism works best when it is win-win, and everyone benefits. If Microsoft opens up source code in a way that benefits others, that is good. If they also benefit themselves, that is even better. I don't understand why some people need to criticize those doing good deeds, just because they aren't doing perfect deeds.
Amen - it definitely seems more like false equivalence by holding up everyone to an asymptotic ideal (nobody's perfect, therefore everybody and all deeds are flawed).
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It's not charity, plain and simple. It's one big tax cheat that needs to DIAF.
The reason why it matters to the Rest of Us, is their outsize influence in government policy - such as anti-citizen immigration policy and social justice initiatives.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
All questionable.
[redacted phrase] (or so I'm told)
Sometimes you need to make an example of someone, why not start with arrogant tax cheats? Take both the player and the game out to the woodshed, everyone wins!
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
Similar reason that Google introduce Alphabet. It is more convenient to start many projects in a company solely designed to do these things than doing under Facebook's name. No need to worry about other share holders' and broad members' disapproval. The new LLC is just a property management company to fulfill Mark and Chan's dreams. And they call the dreams "charity". Maybe It will do real charity, maybe not. I believe one policy that the LLC will lobby heavily on is increasing H1B cap. For Mark, it is charity. For others, it's not.
If you have to use exotic accounting to deal with taxes, chances are you're not up to any good.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
That's what you're saying, not what AC was saying.
Also, you're right, criticism is bad, no one should ever be critical of anyone else.
A fool and his hard drive are soon parted.
Yes in the sense that there is no (actual) tax advantage or legal need for moving the shares from his personal account to the LLC.
No in the sense that without the LLC and PR hoopla selling a large amount of stock by the Founder/CEO/Majority share holder would shake investor confidence wipe out the valuation of FB stock pretty quickly. Since Zuck already did is 'one-time-huge-sale' at the IPO where he sold $1b of stock he has more than enough personal cash for anything he could reasonably claim as the reason for selling a large percentage of his remaining shares.
With the intermediary vehicle in place there is a blanket reason for divestiture and he can have a standing sell order of $10-100M worth of shares sold on a monthly basis. Then when the LLC sells the stock (however quickly) it is understood that the LLC needs $$ for operating and investments not as a lack of confidence in his own company.
Typical. I don't understand the derogatory use of the term. By definition, social justice is something all people should strive for.
Ultimately, though, the question is how is he going to end up with *more* money than when he started. Let's say his good friend's charity gets the full $45B in shares. Then what? There are rules about what a charity can do with that cash, and giving it back to Mark Zuckerberg and his family isn't really on the list. Likewise with SuperPACs. He's lost direct access to the 45B and will only be able to get his hands on a small percentage of it under weird circumstances, but now he has political influence to... do what exactly? Somehow earn another $45B to make it worth the investment?
The problem with all of these stories is that they lack actual numbers to illustrate how the perpetual motion machine is supposed to work. Yes, the tax code has a lot of holes in it, but I'm very skeptical of a lot of these just-so stories.
An interesting anagram of "BANACH TARSKI" is "BANACH TARSKI BANACH TARSKI"
Typical. I don't understand the derogatory use of the term. By definition, social justice is something all people should strive for.
While I agree using SJW as derogatory is silly, using definitions of terms in an acronym or group names out of context is even worse.
You disagree with libertarians? Why do you hate liberty?
You disagree with socialism? Why are you anti-social?
You didn't like the NAZI (National-socialist German Workers) Party? Why do you hate the working man?
-- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
What the AC said was a bit overblown, but, then again, so was your response... as was your snarky (and not at all clever) retort to ShanghaiBill.
The AC's point wasn't that something like MS releasing source code is entirely altruistic; their point was that, if there's any hint of self-interest, assholes looking to assert their own moral high-ground by pointing out flaws in others will jump all over that self-interest. ShanghaiBill's point was that, yeah, self-interest may exist, but that doesn't mean that the act itself lacks any altruism, or that it can't still be beneficial to everyone, overall.
ShanghaiBill also wasn't saying that people shouldn't criticize anything, or even that people shouldn't criticize good deeds -- I don't even know how you came to that conclusion (unless you just like to set up painfully obvious strawmen). Pretty clearly, he was saying that there is such a thing as constructive criticism, and criticism that doesn't benefit anyone (aside from, maybe, the critic). Those that choose the latter, as you have, are generally just looking to stir shit in an effort to see how high on the douchebag scale they can ascend.
By the way, the AC was correct about those attempting to prove themselves holier-than-thou: they're always on the lookout for any misstep by anyone. Such criticism is easy (and lazy) since nobody is perfect, and, if you buy into that type of criticism, ultimately cannibalistic. There will, after all, always be someone waiting to catch you in such a misstep, and someone waiting to catch them, and so-on.
"Is not a sentence" is not a sentence. Well damn.
It's now so onerous to run an organization the IRS considers a "real" charity that lots of big money that actually cares about accomplishing something, will soon be taking similar steps.
It is not *onerous* to run a legal non-profit (e.g., "real" charity). The provisions in the law Mr. Z. probably doesn't like about legal charities is that they aren't allowed to *hoard* money and must spend most of their annual income on charitable pursuits every year (a $1B will throw off a bunch of imputed income at a minimum that will need to be distributed). If you want to *hoard* your money or not spend all of it on charitable pursuits, you might consider the legal provisions *onerous* and want an LLC.
In contrast, the Bill and Melinda Gates Foundation is an actual legal charity. What Mr. Z is doing is similar to a trust (e.g., the kind of legal structure that directs how your inheritance is distributed after you die). There's no requirement that a trust spend the money charitably (you may have heard of trials and tribulations of many trustfund babies) and there is no requirement to disclose how it is distributed.
I'll give Mr. Z the benefit of the doubt. Maybe he doesn't want a non-profit because he has no idea what charitable cause to spend his money on yet (he had so much luck with NJ schools donation) and doesn't want to be forced to spend the money right away until his has time to figure it out. On the other hand he could have just said that, so maybe he has an ulterior motive.
FWIW, as I recall being forced to distribute the imputed income annually was an issue with Warren Buffet donating his money to the B&M Gates foundation. He conditioned his donation on Mr Gates stepping down from MSFT and operating his foundation full time rather than leave it to foundation employees (and likely be pissed away).
While I'm in no way a fan of Facebook, I do applaud Zuckerman's step.
As for the people "complaining" and looking for excuses, I would wager a bet that almost all of them haven't even considered giving 1% of their income for any public cause (I'm talking about unforced giving, not taxes). They are just trying to find an excuse for their OWN failure to help out others. ... seeing what the government spends the majority of its money on (hint: it's not spent for those that really need it ...).
And even IF Zuckerman didn't pay any additional taxes - if what he is planing to do is done like that, and benefits in the way he hopes it does, I would also bet the money not paid as taxes would help at least twice as much as it would have by being taxed
Those fools hate everything and everybody.
Bill Gates did it.
Yes in the sense that there is no (actual) tax advantage or legal need for moving the shares from his personal account to the LLC.
At this point, it is less about the money (tax benefits) and more about the power and control for Zuckermann.
.
The LLC gives him far more power and control than a non-profit would.
When he gives the money to a non-profit, he loses control of the money, he cannot do anything with it that he wants. Hence he loses power.
When he gives the money to his LLC, he retains full control over it, retaining his power status.
Money that cares about accomplishing something can bloody well pay its taxes for it, whether someone thinks its cause is just or not. The whole concept of tax exemption is just asking for tax evasion, which in turn will of course result in regulation. The same goes for religious exemptions.
Forget magic. Any technology distinguishable from divine power is insufficiently advanced.
The same goes for religious exemptions.
Except the "religious exemptions" is there as part of the separation of church and state. If the state can tax the church then there is no longer any separation.
It's his money and he can. However, when it comes to things like tax dodges (something this type of setup is often used for, e.g. estate taxes) etc then it affects more than just him. Also, if somebody is going to do something like this and air the "philanthropic" goals for PR, then calling bullshit is fair game.
What if what he likes to do is lie?
Try out politics and use his charity to fund his campaign.
Zuckerburg is transferring shares into the LLC., where he can donate shares directly to a charity or sell shares to raise cash to buy businesses.
I doubt Zuckerburg can do a better job than George W.
The more exotic accounting that is required, the less legitimate the tax arrangement.
I have that feeling every time I fill out a 1040EZ. Too much accounting!
Except the "religious exemptions" is there as part of the separation of church and state. If the state can tax the church then there is no longer any separation.
Were that the case, the religious exemption would be a LOT easier to apply for and get. Also, amusingly, the religious tax exemption probably falls afoul of Jesus' own directive to render unto Caesar what is Caesar's (not to say that ONLY christian organizations benefit here, but they're arguably the biggest beneficiaries in the US).
What part of "shall not be infringed" is so hard to understand?
Short of some disinterested party having control, it's nothing more than a tax dodge in need of elimination.
Modbombing me with -Infinity, Disagree won't change it.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
It doesn't take an accounting major to write out the answers to a 1040EZ.
On the other hand, it does take one to construct the exotic tax arrangements that have no good worth to exist.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
Exotic accounting is still being a tax cheat, no matter how you want to call it.
It's not ex post facto if they're punished for continuing action of a certain type. In addition, the rule of law remains since it would penalize the action, not the actor.
Twitter supports and protects racists - by smearing their critics with the "Hate Speech" label.
I've also been involved with a number of small non-profits. The truth is that ALL of them are in violation of various non-profit regulations in a number of ways... it just doesn't matter because they are small enough no-one cares and no-one will check,
If you want to have a large non-profit that makes a greater difference, you'll have to actually start paying attention to the real rules, and that is where the burden becomes heavy (not to mention restrictive as to activities that are considered matching the purpose of your organization).
If this were not true, Zuckerberg would not do what he did. I trust his (and others) actions far more than your suppositions.
"There is more worth loving than we have strength to love." - Brian Jay Stanley