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Mark Zuckerberg’s Philanthropy Uses L.L.C. For More Control

nytimes.com

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Re: Mark Zuckerberg’s Philanthropy Uses L.L.C. For More Control

#91

Post by adventured »

sharkweek wrote: post #66
mikeash wrote: post #47

I don't think I've seen a single positive statement about Zuckerberg's foundation. It would have been 100% fully within his right to simply keep it all, or blow his fortune on snorting Fabergé eggs, or buying classic cars and crashing them. Instead, he's giving almost all of it away. He's choosing to retain control over how it's given away? Well so what! It's still way better than keeping it all. I am no fan of Faceb…

I think Chan and Zuckerberg will do incredible things with this money, but I also appreciate the cynicism of ultra-rich philanthropy. We as a society will be reliant on "hoping the kings are just with their gold" as they make decisions based on their personal preferences. This is undemocratic and should be under perpetual scrutiny. I likely agree with what Chan and Zuckerberg will be doing with this money, but what a…

Those relatives with high incomes are almost guaranteed to get taxed at a higher rate via income than any other distribution formula of that money would produce. In the US if you're in typical high net worth locations, you're going to pay ~33% to 50% on high amounts of income between state and federal.

So what's the problem? Those high incomes get taxed at a high rate. There's a reason the rich pay such an extreme portion of all income taxes in the US.

Re: Mark Zuckerberg’s Philanthropy Uses L.L.C. For More Control

#93

Post by dnautics »

matt-attack wrote: post #25

I thought it was impossible to donate money (in a tax deductible manner) if you the donor had any direct control of how the money was spent. This was supposed to prevent folks from, say, donating their money to a charity which then sends their own child to college.

That's not entirely true. I run a 501(c)(3) and I can donate to it and deduct it from my income. But I also don't pay myself out of it (or anyone really), and I have to be careful not to make purchasing/leasing etc. deals with relatives (not a problem in my case). The issue is not control, but disbursement of funds. Giving is fine, its how you use it that is scrutinized.

Think of it this way: let's say the nonprofit needs pens from office depot. I could also just as easily have paid out of pocket and not donated to the (c)(3) and claimed it as a business expense, with the same net effect and less paperwork

Re: Mark Zuckerberg’s Philanthropy Uses L.L.C. For More Control

#94

Post by dubya »

mikeash wrote: post #47

I don't think I've seen a single positive statement about Zuckerberg's foundation. It would have been 100% fully within his right to simply keep it all, or blow his fortune on snorting Fabergé eggs, or buying classic cars and crashing them. Instead, he's giving almost all of it away. He's choosing to retain control over how it's given away? Well so what! It's still way better than keeping it all. I am no fan of Faceb…

Giving away all of your money is not necessarily good for everyone else. For example, giving billions to promote "teaching the controversy", or iPad literacy or Morris dancing in schools would alter the curriculum in ways that some people would (rightly) disagree with.

Re: Mark Zuckerberg’s Philanthropy Uses L.L.C. For More Control

#95

Post by cerebrum »

mikeash wrote: post #47

I don't think I've seen a single positive statement about Zuckerberg's foundation. It would have been 100% fully within his right to simply keep it all, or blow his fortune on snorting Fabergé eggs, or buying classic cars and crashing them. Instead, he's giving almost all of it away. He's choosing to retain control over how it's given away? Well so what! It's still way better than keeping it all. I am no fan of Faceb…

> I don't think I've seen a single positive statement about Zuckerberg's foundation.

What do you expect? As long as not a single cent has changed hands why should anyone praise what up to now is only a PR move?

Contrast that with J.K. Rowling who actually donated money and is now no longer a billionaire.

Re: Mark Zuckerberg’s Philanthropy Uses L.L.C. For More Control

#96

Post by encoderer »

darkstar999 wrote: post #29
encoderer wrote: post #14

Earlier quoted context omitted.

Regular working class citizens can also pay lower taxes on their investments than on their own labor.

Regular working class citizens don't have investments for the most part.

All the software developers on HN consider themselves rich then? To me, working class means you have to work to pay your bills. A lot of people in that category have investments in the stock market and in their home.

Re: Mark Zuckerberg’s Philanthropy Uses L.L.C. For More Control

#97

Post by [deleted] »

whoiskevin wrote: post #62
mikeash wrote: post #47

I don't think I've seen a single positive statement about Zuckerberg's foundation. It would have been 100% fully within his right to simply keep it all, or blow his fortune on snorting Fabergé eggs, or buying classic cars and crashing them. Instead, he's giving almost all of it away. He's choosing to retain control over how it's given away? Well so what! It's still way better than keeping it all. I am no fan of Faceb…

"Meanwhile, how much are the commenters themselves giving away? Oh, somewhat less than 99%? Yeah." Terrible statement. If a commenter here makes 100,000 and gives away 99% well they are now extremely poor. If I have billions and give away 99% my life isn't likely to change.

[deleted]

Re: Mark Zuckerberg’s Philanthropy Uses L.L.C. For More Control

#98

Post by cerebrum »

mikeash wrote: post #47

I don't think I've seen a single positive statement about Zuckerberg's foundation. It would have been 100% fully within his right to simply keep it all, or blow his fortune on snorting Fabergé eggs, or buying classic cars and crashing them. Instead, he's giving almost all of it away. He's choosing to retain control over how it's given away? Well so what! It's still way better than keeping it all. I am no fan of Faceb…

> "Meanwhile, how much are the commenters themselves giving away? Oh, somewhat less than 99%? Yeah."

Dude I've met lots of people who don't make much money and still donate from the little they have. They might be giving only 10% but if you already have difficulties making ends meet this is a lot.

So no, I don't buy into some billionaire putting his money into a LLC to evade the tax and claiming to do something good.

Btw I wouldn't be pointing my finger if it wasn't for the public announcement. He still could do that in private. But don't make a big fuss about it and pretend you are an example.

Re: Mark Zuckerberg’s Philanthropy Uses L.L.C. For More Control

#99

Post by harryh »

amalag wrote: post #39
jayess wrote: post #12

Earlier quoted context omitted.

As far as I understand, he wouldn't avoid estate taxes. Whoever dies last would still own the LLC as an asset and the estate is taxed on the value of that asset. With their combined estate tax exemption, about $10.5 million, any value over that would be taxed at 40%. Unless he remains true to his word and he expects to spend it all before he dies. The only "avoidance" of taxes happening here is during the initial tra…

I don't want to be totally negative on Zuckerburg. Maybe he will do good with the money. However: An estate would not be taxed on the value of the LLC, the same way one he is not taxed on the value of his stock. It is taxed when sold. If he assigns family members as owners there would not be additional taxes when he passes away if the LLC's money continues to grow. >11. Limited Liability Company (LLC) and Family Limi…

If Zuck "transfers assets like a family business, farm, real estate or stocks to his children now" then this transfer would, presumably, be far far in excess of the $14,000 annual exemption and thus subject to taxation.

This LLC is not an effective way to avoid estate taxes on the vast majority of his wealth.

Re: Mark Zuckerberg’s Philanthropy Uses L.L.C. For More Control

#100

Post by cerebrum »

stuartaxelowen wrote: post #69
whoiskevin wrote: post #62

Earlier quoted context omitted.

"Meanwhile, how much are the commenters themselves giving away? Oh, somewhat less than 99%? Yeah." Terrible statement. If a commenter here makes 100,000 and gives away 99% well they are now extremely poor. If I have billions and give away 99% my life isn't likely to change.

Well, 50%? 25%? 5%?

Even 5% is a lot if you already have difficulties making ends meet. I mean you still want to invest something to have some kind of a cushion if you lose your job right?

So yes, for someone with little income donating 5% can already be too much.

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