Elon Musk Set To Pay Whopping $11 Bln In Taxes This Year
Elon Musk has finally put the speculations and controversies around his hysteric stock transaction to bed after announcing that he will pay more than $11 billion in taxes in 2021.
The Tesla, Inc. (TSLA) CEO tweeted on Sunday, “For those wondering, I will pay over $11 billion in taxes this year.” Historically, this is going to be the largest amount of tax ever aid by a single individual.
The richest man on the planet has been selling Tesla stock and exercising buying options since the start of November, selling the stock at the present market rate and buying them at $6.24 by exercising the share options that he was rewarded back in 2012. The transactions were reportedly under Rule 10b5-1, a plan that allows the insiders of the company to perform trades on their own share of company stock at a said time. Musk still has a lot of stock options that he has to exercise before August 2022 when the stock options expire. CEO has 7 million stocks left to exercise.
Musk has been criticized as a tax-evader after ProPublica published a report showing that Musk has not paid his taxes in 2018. The richest man on earth with an estimate of around $254 billion, Musk will have to pay almost 53% of his net worth in taxes, according to the tax rates.
According to reports, Musk will have to pay a top of bracket 37% federal tax for his transactions and another 3.8% net investment tax. Considering that Musk has spent almost $15.8 billion to exercise the stock options, the amount of tax would be around $6.4 billion. If he exercises the rest of the options, he will have to pay another $5 billion in taxes. While Musk would’ve taken more time to exercise the options, a newly proposed, Build Back Better bill is on the verge of getting passed which will increase Musk’s tax by almost 8%.
Last week, during a Twitter beef with Senator Elizabeth Warren, Musk had hinted that he will pay the most in taxes this year than anyone has ever paid. “And if you opened your eyes for 2 seconds, you would realize I will pay more taxes than any American in history this year,” he had tweeted.
Source: Read Full Article