It’s reasonable to have a discussion about private citizens and their tax burden. Really, it’s never going to be settled. It never should be settled. And that’s a good thing.
Then there’s Facebook getting $429 million as a tax bonus on top of earning $1.1 billion in profits. Oh, and this is after not paying any state or federal taxes. Yep, the federal government is just stone cold handing Zucks and company nearly half a billion of your money.
So, how the hell did they pull off that little trick. The advocacy group Citizens for Tax Justice breaks it down to one loophole, the tax-deductible nature of stock options:
Facebook’s income tax refunds stem from the company’s use of a single tax break, that is the tax deductibility of executive stock options. That tax break reduced Facebook’s federal and state income taxes by $1,033 million in 2012, including refunds of earlier years’ taxes of $451 million.
Facebook isn’t the first to use stock options as a massive tax scam: Microsoft in particular has been running this shell game for years.
Still, it’s kind of hard to see why, precisely, a company, any company, that made a billion freaking dollars is getting nearly half of that back from the government. Facebook is particularly grating because most of its content is generated by users; essentially if you live in America and have a Facebook, you just paid Facebook to exploit your content.
The government doesn’t want to tax their profits, fine, but come on. The only way this could be worse is if you actually made taxpayers walk up to Zuckerberg (net worth: $14 billion) and actually write out the check to him.
I want more like this!
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