Re:Tesla’s headquarters will move to Austin
by darawk on Thursday October 07, 2021 @08:48PM
(#28794247)
No it isn't. CA will still try to tax those shares if and when he decides to liquidate them. However, Musk does not ever need to liquidate any shares. If he never wants to pay any tax, all he has to do is buy a hedge against the shares (thereby locking in a particular price) and take out loans against the now hedged asset. And like magic, he's got all the cash he could ever need and zero capital gains.
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Re:Tesla’s headquarters will move to Austin
by random314 on Friday October 08, 2021 @02:34AM
(#28796354)
Can I do this with my vesting stocks? I get tax deducted stocks, always!
Re:Tesla’s headquarters will move to Austin
by darawk on Friday October 08, 2021 @03:42AM
(#28796706)
You sure can. You just need to find a bank/broker/anyone willing to lend to you against them as collateral.
Re:Tesla’s headquarters will move to Austin
by jtsiskin on Thursday October 07, 2021 @10:00PM
(#28794862)
…but how does he pay back those loans?
Re:Tesla’s headquarters will move to Austin
by plorkyeran on Thursday October 07, 2021 @10:58PM
(#28795243)
His estate pays them back when he dies. Inherited shares have their cost basis reset to the current value, so if his heirs sell them immediately there's no capital gains to be taxed.
Re:Tesla’s headquarters will move to Austin
by double_nan on Friday October 08, 2021 @12:34AM
(#28795784)
The loan will be cheap but not free. The problem with shares is that their price can go down to zero in case of company bankruptcy. So there will be premium for that risk.