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Tesla Reported Zero Federal Income Tax on $2B of U.S. Income in 2024

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Re: Tesla Reported Zero Federal Income Tax on $2B of U.S. Income in 2024

#61

Post by subulaz »

JumpCrisscross wrote: post #15
pylua wrote: post #5

Tax breaks for executive options ?!

> breaks for executive options Difficult to tie this to executives versus shareholders. Options are taxed.

not too difficult actually, US corps are required to disclose specifics on employee option compensation for tax purposes: https://www.thetaxadviser.com/issues/2023/dec/executive-comp...

FINRA 2360 provides disclosure and tax requirements to any organization which issues options, provides grant exercises, or simply issues stock as compensation: https://www.finra.org/rules-guidance/rulebooks/finra-rules/2...

Side note: the regs are partly why you can see detailed information about types and amounts of stock and option activity by different investor classes in tools like https://www.barchart.com/investing-ideas/insider-trading-act...

Re: Tesla Reported Zero Federal Income Tax on $2B of U.S. Income in 2024

#62

Post by oliwarner »

jared_mccluskey wrote: post #58
Frieren wrote: post #31

Earlier quoted context omitted.

> Standard for every company. That Apple, Google, Amazon, etc do not pay their taxes either makes it worse not better. The rich have accumulated a lot of money, that is killing the economic system. Redistribution of that wealth is needed for the system to continue working, and taxation is part of the solution.

All you told me is that you don’t understand how depreciation and loss works. If you lose money, why should that be taxed?

They aren't losing money, they're spending it [on themselves].

The problems in taxation come when a company's spending isn't benefitting the area/country or its employees' taxable income. Buying offshore yachts to rent back, sinking money into highly-depreciative assets (eg company cars) that might not be taxed as employee benefits. There's a lot to unpack but the bigger you are, the easier it is to hide a few billion dollars from the national taxation service by hauling it off to another area.

Re: Tesla Reported Zero Federal Income Tax on $2B of U.S. Income in 2024

#63

Post by stogot »

mihaic wrote: post #47
JumpCrisscross wrote: post #25

Earlier quoted context omitted.

> Only the population pays taxes before their costs Not that simple. Plenty of individuals pay a negative income tax. Plenty of individuals deduct various expenses. And if you're a sole proprietor, you get to deduct expenses like a corporation. Labour v capital != corporations v people.

You've said something true that misses the point. Taxation disproportionately comes from wages, and most in the middle class can't avoid them, even though they are a pillar of the economy.

Half of taxpayers pay 97.7% of federal income tax

https://taxfoundation.org/data/all/federal/summary-of-the-la...

Re: Tesla Reported Zero Federal Income Tax on $2B of U.S. Income in 2024

#65

Post by throwaway2037 »

arcticbull wrote: post #38
throwaway2037 wrote: post #27

Earlier quoted context omitted.

> Individual tax rates in California are as high as like 52%. Is that a marginal tax rate (not very useful for comparison) or an effective tax rate? Also, can you explain why income level is required to achieve 52% "individual tax rate"?

Yes, the top marginal rate is 37% federal + 13.3% state + 0.9% surtax -- and note the state tax is generally double-taxed at this income level thanks to the SLPT cap. Can it also be an effective rate, yes, pretty close anyways.

At what personal income level does this top marginal rate apply? 250K? 500K? 1M?

Re: Tesla Reported Zero Federal Income Tax on $2B of U.S. Income in 2024

#66

Post by aqme28 »

arcticbull wrote: post #24
aqme28 wrote: post #19

Earlier quoted context omitted.

Yes, but that’s not the whole picture. If the value of the company goes up, shareholders capture value as capital gains which has a very low tax rate.

Low... ish... depending on where you are. Short term gains are taxed as ordinary income, long-term gains are taxed up to 20% (already the corporate rate) and states like California treat it as ordinary income exposing you to another up to 13.3%

It's still never higher than income tax, which is what the parent comment was comparing to.

Re: Tesla Reported Zero Federal Income Tax on $2B of U.S. Income in 2024

#67

Post by s1artibartfast »

arcticbull wrote: post #18
nicce wrote: post #16

Earlier quoted context omitted.

> either when Tesla shareholders sell appreciated stock, when the company makes distributions or when they liquidate. Feels like a fatal flaw in the law if you can bypass paying the corporate taxes in that way. That is individual tax - not the tax payed by the corporation. Normally the tax is payed twice. Tax from the corporation profits and then the individual employee/shareholder tax based on their income.

At least today the corporate tax rate is 21%. Individual tax rates in California are as high as like 52%. In almost every scenario you'll see a higher rate on the distributions and buybacks than you would carrying it forward to the following year. I guess you could make a case for double-taxation but... why?

Income from a corporate entity is taxed twice by the time it gets to an individual. If I own a corporation and live in California, first I pay 21% on the profits and then 52% on what is left before it gets to my bank account.

At these rates, This means the government takes 72 cents out of every dollar of profit.

Re: Tesla Reported Zero Federal Income Tax on $2B of U.S. Income in 2024

#69

Post by readthenotes1 »

hshshshshsh wrote: post #35
GolfPopper wrote: post #23

Earlier quoted context omitted.

I think capitalism or socialism are neither problem nor solution; they're just tools, frameworks. The problem is greed and our willingness to accept it.

Isn't capitalism based on the idea that everyone is greedy and we should exploit that for betterment of everyone. And socialism based on the idea that everyone is greedy and we should prevent that for betterment of everyone.

For capitalism to work, you have to limit greed.

For socialism and communism to work, you have to limit greed, envy, and sloth.

Re: Tesla Reported Zero Federal Income Tax on $2B of U.S. Income in 2024

#70

Post by ASalazarMX »

StefanBatory wrote: post #55
GolfPopper wrote: post #23

Earlier quoted context omitted.

I think capitalism or socialism are neither problem nor solution; they're just tools, frameworks. The problem is greed and our willingness to accept it.

I know, but that's just the standard idiom, isn't it?

I prefer "privatize the wins, socialize the loses."
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