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Submission + - Facebook paid no taxes despite record profits ( 2

Frosty Piss writes: Despite earning more than $1 billion in profits last year, social media juggernaut Facebook paid zilch when it came to federal and state taxes in 2012. In fact, the website will actually be getting a refund totaling $429 million thanks to a tax reduction for executive stock options. In the coming years, Facebook will continue to get monster tax breaks, totaling about $3 billion. 'The employees cash in stock options, and at that point there is tax deduction for the company,' Robert McIntyre, of watchdog group Citizens for Tax Justice, said. 'Because even though it doesn't cost Facebook a nickel, the government treats it as wages and they get a deduction for it. And usually it doesn't wipe out companies whole tax bill, although many companies get big breaks from it.'
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Facebook paid no taxes despite record profits

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  • So a large portion of the tax breaks is stock options to employees, and of course the employees will have to pay taxes on the net gain from those options once they are exercised. So Uncle Sam gets its slice of the pie eventually, possibly at a higher tax rate than if Facebook had been the one writting the checks to the IRS.
  • How's to blame?
    If i say blame Obama! - then i would get downvoted.
    If i say great work Obama! - then i would get downvoted.

Never buy what you do not want because it is cheap; it will be dear to you. -- Thomas Jefferson