Facebook to dodge taxation

Facebook to dodge taxation

Joined: May 7th, 2002, 12:38 pm

February 17th, 2012, 6:12 pm #1

Lovely. There is something really wrong in my mind with the notion that profitable corporations need not contribute to the country whose systems and freedoms contributed to the ability to build their successes...

http://www.ctj.org/taxjusticedigest/arc ... filing.php

~SNIP~

Facebook, Inc.s upcoming initial public stock offering (IPO) paperwork reveals that it plans to wipe out all of the company's federal and state income tax obligations for 2012 and actually generate a half billion dollar tax refund. As part of the plan, Facebook co-founder and controlling stockholder, Mark Zuckerberg can expect a $2.8 billion after tax cash windfall....

...When, as Facebook expects, the 187 million stock options are cashed in this year, Facebook will get $7.5 billion in tax deductions (which will reduce the company's federal and state taxes by $3 billion). According to Facebook, these tax deductions should exceed the company's U.S. taxable 2012 income and result in a net operating loss (NOL) that can then be carried back to the preceding two years to offset its past taxes, resulting in a refund of up to $500 million.

Senator Carl Levin, who has proposed to limit the stock option loophole, told the New York Times, "Facebook may not pay any corporate income taxes on its profits for a generation. When profitable corporations can use the stock option tax deduction to pay zero corporate income taxes for years on end, average taxpayers are forced to pick up the tax burden. It isn't right, and we can't afford it."

~END SNIP~

Yeah, not right. Not right at all.

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February 17th, 2012, 6:57 pm #2

I'm not logging on to that shit ever again!~
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Joined: May 7th, 2002, 12:38 pm

February 17th, 2012, 7:03 pm #3

I don't want to kill it, like any addiction, make it legal and let's tax it!
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February 17th, 2012, 7:05 pm #4

So, in this metaphor Google+ is like the resin in the bottom of the bowl you scrap up and smoke on a Sunday morning, right?
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Joined: June 28th, 2002, 4:37 pm

February 17th, 2012, 7:09 pm #5

Yes, and Myspace is the "Spice" legal high stuff you get at the corner store. No one tries it until they can't get weed or they need to clean up.

Eh.
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Joined: March 11th, 2004, 4:19 pm

February 17th, 2012, 7:09 pm #6

I'm not logging on to that shit ever again!~
I agree that American citizens and corporations should pay into the system that allows this country to be such a safe and efficient place to do business. On the other hand, a company like Facebook is exactly the type of business we want to establish in America. There should be some financial incentives for corporations to maintain their operations on US soil. As far as the best way to go about doing that? I'm no economist.

Last edited by Funkenstien on February 17th, 2012, 7:10 pm, edited 1 time in total.
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Joined: May 7th, 2002, 12:38 pm

February 17th, 2012, 7:12 pm #7

How about just no refunds for getting rich? They're going to MAKE money off the US Government for having the most profitable IPO in history?

Seriously, how fucked up is that?



(OK OK, a refund isn't really MAKING money, but still...)
Last edited by SquiddyBoy on February 17th, 2012, 7:13 pm, edited 1 time in total.
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Joined: March 11th, 2004, 4:19 pm

February 17th, 2012, 7:20 pm #8

Absolutely true, and I agree on the surface it seems like Facebook is getting away with highway robbery. But what's stopping this type of business (minimal brick and mortar footprint) from declaring an IPO on the Japanese stock market or the European stock market? The only thing is that Mark Zuck and the stockholders want to earn a profit.

I think that as compensation for Facebook's tax breaks, the company should have a very long (50 - 100 year) and mandatory time frame where they have to remain incorporated in America and subject to US Taxation. Not to mention the whole dame tax code needs to be scrapped and rewritten.

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Joined: May 7th, 2002, 12:38 pm

February 17th, 2012, 7:26 pm #9

Agreed on the tax code.

How much is enough? Zuckerberg is mind bogglingly wealthy, and this IPO will increase his wealth exponentially.

He's already the following on Forbes Lists:

#9 Powerful People
#14 Forbes 400
#52 Forbes Billionaires
#22 in United States

I bet the IPO gets him to top 10 on most of those lists.

He's worth $17.5 Billion right now.

The median household income for 2006-2010 is $51,914. It would take that household 337,096 YEARS to earn that amount of money.

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Joined: May 7th, 2002, 12:38 pm

February 17th, 2012, 7:29 pm #10

Facebook said in its prospectus that it plans to raise as much as $5 billion in an IPO. The Menlo Park, California-based company is discussing a valuation of $75 billion to $100 billion, two people familiar with the matter said last week. At the top end of that range, Zuckerberg will own stock worth $28.4 billion. His command of the company goes beyond stock -- he controls 56.9 percent of the voting power.

http://www.washingtonpost.com/business/ ... story.html
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