Mark Zuckerberg may owe $1.1 billion in taxes

The Facebook founder bought 60 million shares of his company for just 6 cents during the IPO. The IRS treats that as income, even if he hasn't sold those shares.

By Kim Peterson Apr 1, 2013 3:33PM
Mark Zuckerberg (© Noah Berger/Bloomberg via Getty Images)Mark Zuckerberg's team of accountants has a big headache on its hands: The Facebook (FB) founder probably has a tax bill of around $1.1 billion.

Zuckerberg bought 60 million Facebook shares for just 6 cents each on May 18, 2012, the day of the company's initial public offering, CNNMoney reports. But even if he never sold those shares, they still count as income, bringing his income just from stock options last year to nearly $2.3 billion.

Under California's highest-tier tax bracket, Zuckerberg would likely get taxed at 48.3%. There are several loopholes the wealthy can take advantage of, but three California accountants that CNNMoney talked to estimated Zuckerberg's 2012 taxes at higher than $1 billion.

To put that in perspective, Zuckerberg is paying almost half of 1% of the total that all Americans paid in 2011, according to The Huffington Post.

Zuckerberg wasn't surprised by the tax bill. He sold some 30.2 million shares for $1.135 billion during the IPO just to cover the costs, according to CNNMoney.

Zuckerberg may be paying up, but his company has escaped the long arm of the IRS. My colleague Aimee Picchi reported in February that Facebook skipped out on federal and state income taxes and may have actually received tax refunds of $429 million.

More on moneyNOW


Tags: FBTaxes
607Comments
Apr 1, 2013 4:10PM
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It's time to end this convoluted 70,000+ pages of idiocy and lunacy known as the federal tax code!  Scrap it all and implement the Fair Tax!  The sooner, the better.
Apr 1, 2013 5:54PM
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48 percent is too much. If you are genius enough to become a self made billionaire you deserve it. My income is still less than six figures, but I don't think he or anyone else should have to pay for people not motivated to succeed. That is called communism.
Apr 1, 2013 4:23PM
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I thought the democrats said "rich people don't pay taxes". Guess Obama is wrong again.
Apr 1, 2013 5:04PM
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Well he owes some taxes...That's a good thing...

But I'll bet there are a battery of Lawyers and Tax Accountants, working night and day; On ways to cut that bill substancially.....Just sayin...

 

Yes I agree with scrapping the tax codes as wriiten, they are a nightmare.

And archaic.......

Apr 1, 2013 5:48PM
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Ok his owes some tax, but I also think that 48% is a little high!!!  It isn't fair and just because he has lots of money doesn't give any state the right to go a collect over maybe 25% from everyone.  He made money which is the American dream, states and Fed's should only collect what is fair.  Cal! I wouldn't be a resident is it was the last place in the US!  Over rated state
Apr 1, 2013 6:01PM
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What people don't understand in this entire commentary is the fact that Facebook hit the "IPO", for Initial Public Option....when EVERYONE is supposed to be able to purchase shares, it started for the average citizen at over $35.00 per share. And he bought them for $0.06?! But don't worry average middle class investor...alot of our congressional representaives and government officials got into this "insider trading" scheme as well.  
Apr 1, 2013 6:18PM
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I find it comical that all these people complaining about rich guys forget he is one of those paying for your welfare and obamaphones and food.
Apr 1, 2013 5:50PM
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They can't scrap the tax codes because the IRS would lose money by dumbing everything down so that the average american could understand it and fight back!

Apr 1, 2013 4:41PM
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Skipped out? If you use legal tax planning strategies how is that skipping out?  Also the only way a corporation gets a refund is if they paid the tax in in the first place.  Its not like FB is getting child care or low income credits.
Apr 1, 2013 5:18PM
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The money he "made" from those shares would never have existed in the first place had he not gone public as it would've been privately held. So, all that money that he "made" was only because its based on the image and projected future profitability of the company. Simplified: No IPO no making an instant $2 billion. Not to mention the fact that an IPO was suppose to be used as a means to bring in investors for capital to expand a business. Not get rich quick.
Apr 1, 2013 6:03PM
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Oh go ahead feds and Cali, just take all his money.  

He is a big Dim Obamao supporter so he should be expecting it.

He didn't build that thing anyhow....he stole it.
Apr 1, 2013 7:01PM
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Anyone reading this could have invented facebook, but didn't. According to the socialist Obama, it's Zuckerberg's duty to support all of those who didn't work hard enough to get into Hardward and didn't have the ability to do what he did. His tax bill is ridiculous as is the lunacy of the socialists.

 

What business do you think Zuckerberg might create with 1.1 BILLION DOLLARS and how many people do you think it might employ. Or if he had it to spend and spent it, how many jobs would that create vs. giving it to a very wasteful government, which uses it to let our rulers buy votes.

 

And that last part refers to Republicans too!

Apr 1, 2013 5:53PM
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Does anyone actually believe there will come to be a..."fair tax"? Over and over and over all we hear is "we should scrap and implement" yet nothing ever changes in this realm.
Apr 1, 2013 5:52PM
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Well, if you're gonna play you gotta pay! Get out your checkbook Mark!
Apr 1, 2013 5:15PM
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the rich dont pay taxes...at least not their fair share.  say the 0bozobots
Apr 1, 2013 4:57PM
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Wah wah wah.  Those 30.2 million shares you paid $1.8 million for are worth $1.135 billion.  Quit your B!tching we all wish we had our hand in the pot and could make that kind of crazy ROI.
Apr 1, 2013 6:06PM
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A question for all you coveters out there: Is he paying his fair share?
Apr 1, 2013 5:50PM
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Facebook sued for $15 billion for stalking us all on Facebook

big privacy thief's !!!more scam and lies and corruption from facebook he sold more then 1 billion shares to friends and private bankers before it was on the real share market other people go to jail for it !!! the keep there likes, and fig up with bots still and all in court for it !!! people must be blind?? its not a company !!! the don't have value the try to sell tin air ?!!!
Apr 1, 2013 5:54PM
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Zucker owes taxes...that's not news. What WILL be news is if this rich **** actually PAYS those taxes...bet that wont be on MSN ( mainly cuz it'll never happen!!)
Apr 1, 2013 5:33PM
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 Did everybody get it out of their system about taxes. Take a break you are working up a awful sweat.
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