Facebook: Mark Zuckerberg is paying $2 billion to Uncle Sam this year
Facebook CEO Mark Zuckerberg is paying $2 billion in taxes this year. This is around double from last year when he paid $1 billion due to withholding his Facebook pay. Facebook received a tax deduction for every dollar. According to Facebook company filings, Zuckerberg is selling 41.4 million shares worth around $2.3 billion. Most of the net proceeds from the sale will be used for paying taxes that Zuckerberg will incur by exercising options to purchase 60 million shares of Facebook Class B common stock, according to Forbes. Zuckerberg now has 58.8% of the voting power and the sale of the shares will bring him down to 56.1%. After the sale, Zuckerberg will retain over 444 million shares. The IRS revealed data on the the top 400 tax returns.
Zuckerberg’s net worth jumped to $13 billion when Facebook went public. His 2012 tax bill was $1.1 billion, but it wasn’t the IPO that triggered the large tax bill. When Facebook went public, Zuckerberg exercised options and bought 60 million shares of Facebook at 6 cents each. Because Zuckerberg received those options, the tax code say that he had to pay compensation on the spread when he exercised them. Zuckerberg had around $2.3 billion in income just from the options so he sold 30.2 million shares to take in $1.135 billion. Zuckerberg will be able to reduce his tax bill by donating to charity though. Zuckerberg also had Facebook pay $1.9 billion in federal taxes that were related to restricted stock units.