Musk isn't eligible for ISOs, so any options he gets are taxed in the year they are exercised. Sure, he can avoid exercising them, but options nearly always have an expiration date. And assuming the stock price has gone up since the options were granted, the taxable amount will be even higher upon exercise.

CA also has some fairly unique (and IMO unfortunate) tax rules where they will still require you to pay taxes on some things even after you've moved out of state. I believe option exercise (for options granted+vested while living in CA) is one of those.