Mark Zuckerberg Defends His $45B Charitable Impulse

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Do any of you really care how Mark Zuckerberg gives away his own money? Most of us would have cashed in all our stocks and retired to an island somewhere by now.

By using an LLC instead of a traditional foundation, we receive no tax benefit from transferring our shares to the Chan Zuckerberg Initiative, but we gain flexibility to execute our mission more effectively. In fact, if we transferred our shares to a traditional foundation, then we would have received an immediate tax benefit, but by using an LLC we do not. And just like everyone else, we will pay capital gains taxes when our shares are sold by the LLC.
 
Bill Gates did effectively the same thing with the Bill & Melinda Gates Foundation so I don't see this as such a big deal overall.
 
Don't care. If he wants to forfeit his child's birthright for an emotional tingling sensation, that is his right.
 
You need money for investment and growth of business which in turns employees more people. You won't get nearly the cost-benefit just by giving it all away.
 
employs*, do they really need to remove the edit in the Front Page News section?
 
aardvark sandwich said:
Don't care. If he wants to forfeit his child's birthright for an emotional tingling sensation, that is his right.
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I'm more along the lines of gates thinking also. Just because your parents have money doesn't mean you should get it all just because you are the kid. I've seen plenty of family businesses get destroyed this way because jr was a retard and never worked a hard day in his/her life.

Like everyone else children should be thought to earn their place in the world and to learn how to fight to keep it. Just throwing money at them will just create a trust fund baby that will become a coke head because they don't do anything they only know how to spend money.
 
The issue isn't how he gives his money away. The issue is that by using an LLC he can "donate" his shares at full market value, write them off on his taxes, and pay no taxes on the value of the shares.
 
Makaveli@BETA said:
I'm more along the lines of gates thinking also. Just because your parents have money doesn't mean you should get it all just because you are the kid. I've seen plenty of family businesses get destroyed this way because jr was a retard and never worked a hard day in his/her life.

Like everyone else children should be thought to earn their place in the world and to learn how to fight to keep it. Just throwing money at them will just create a trust fund baby that will become a coke head because they don't do anything they only know how to spend money.
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As is your right. I dont have a problem with that either.
 
It lowers his tax liability and puts him more in control of how the money is ultimately spent.

So that's probably right along the lines of what some folks like, which is kill any government funding and have private investment instead. However, that's not without problems. Whatever THAT PERSON thinks should be, will be. Instead of the government at least being elected.

Just saying, we can all play 'hate gubmint' but in the end we pay for a government to sustain services we use.
 
So I don't get it, the charity is now in control of Facebook? And when it needs more funding it can give away a little more control?
 
aardvark sandwich said:
Don't care. If he wants to forfeit his child's birthright for an emotional tingling sensation, that is his right.
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If memory serves, Bill Gates was asked about this subject when he said he was going to give away the bulk of his money. His answer was that he wanted to leave his children with enough to anything but not so much as to have to do nothing. Inheriting 45 billion USD makes doing nothing in life a possibility that few could comprehend. Conservatives think that an unemployment check of 300 USD a week is 45 billion dollars. What Zuckerberg is doing here is nothing different from the values that you profess around here.
 
I still don't get how Facebook has a $300B valuation...
 
aardvark sandwich said:
Don't care. If he wants to forfeit his child's birthright for an emotional tingling sensation, that is his right.
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I'm sure you are being sarcastic ... inherited wealth should be the choice of the parents (who earned the money) and not the choice of the children (who have earned nothing) ... the only birthright a child gets is their name (which they can legally change to whatever they want once they reach the age of majority or reach the age of emancipation)
 
lollerwaffle said:
It lowers his tax liability and puts him more in control of how the money is ultimately spent.
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Moving stock to a non-charity LLC doesn't affect his tax liability at all. If the LLC gives stock to charity later, the capital gains will be untaxed and a deduction will be generated which will passthrough to the shareholders, same as if he did it directly. If the LLC sells stock later, the capital gains will be taxable and passthrough to the shareholders, same as if he did it directly.

If he dies and shares in the LLC pass to anyone other than his spouse, they are subject to estate tax, just like if he continued to hold the stock directly.
 
russnuck said:
Indeed, but valuation 65 x quarterly revenue. Same market cap as GE...
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Company valuation is a complex subject. In the case of something like FB, who really knows what its long term value is? Would someone buy FB for $300 billion? Probably not for tons of reasons. Is it worth $300 billion? Could be.
 
I've always liked the philosophy:

If they need it, they don't deserve it
If they deserve it, they don't need it

Maybe I'd feel differently if I had $45 billion coming my way though.........
 
TroubleMagnet said:
I'm sure his family can scrape by for a while on the $450M he will have left over.
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Depends on how well me invest that $450M. Sure the average person if they didn't change their spending habits could live for the rest of their lives off of that and hardly put a dent into that number. But if you are use to spending a few million a year like nothing, that is going to last you maybe 20 - 30 years tops.

sfsuphysics said:
So I don't get it, the charity is now in control of Facebook? And when it needs more funding it can give away a little more control?
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Does he own over 50% of the shares now? If not then no, if yes then over time they would be in control in time. He isn't giving away all 99% right now. he is going to give it so much per year. Either way, a foundation will own a chunk of facebook. Which really isn't any different than a hedge fund or something like that owning a large part of a company.
 
Exavior said:
Depends on how well me invest that $450M. Sure the average person if they didn't change their spending habits could live for the rest of their lives off of that and hardly put a dent into that number. But if you are use to spending a few million a year like nothing, that is going to last you maybe 20 - 30 years tops.



Does he own over 50% of the shares now? If not then no, if yes then over time they would be in control in time. He isn't giving away all 99% right now. he is going to give it so much per year. Either way, a foundation will own a chunk of facebook. Which really isn't any different than a hedge fund or something like that owning a large part of a company.
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Even investing at the most conservative rates -- with his leftover money he makes something like 20+ million a year doing nothing.

I've done the math -- if someone handed me 5 million dollars, I would never have to work another day in my life as I would be clearing 200K + conservatively invested. Of course I'm used to paying my mortgage and bills and living off 30K a year. So it would be easy for me.

I don't like or dislike him -- I think it's funny though, even when billionaires GIVE away their money people come out of the woodwork pissed off at how he did it or what he gave it away for. He could buy every person in the united states an above average hooker... and people would STILL complain.
 
Makaveli@BETA said:
I'm more along the lines of gates thinking also. Just because your parents have money doesn't mean you should get it all just because you are the kid. I've seen plenty of family businesses get destroyed this way because jr was a retard and never worked a hard day in his/her life.

Like everyone else children should be thought to earn their place in the world and to learn how to fight to keep it. Just throwing money at them will just create a trust fund baby that will become a coke head because they don't do anything they only know how to spend money.
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You are just jealous you are not getting a dime. :D:D Me too :p
 
collegeboy69us said:
Even investing at the most conservative rates -- with his leftover money he makes something like 20+ million a year doing nothing.

I've done the math -- if someone handed me 5 million dollars, I would never have to work another day in my life as I would be clearing 200K + conservatively invested. Of course I'm used to paying my mortgage and bills and living off 30K a year. So it would be easy for me.

I don't like or dislike him -- I think it's funny though, even when billionaires GIVE away their money people come out of the woodwork pissed off at how he did it or what he gave it away for. He could buy every person in the united states an above average hooker... and people would STILL complain.
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Ok so you suck at math :p:p:

No matter how much money you got, once you stop having an income it will go away fast.

You may be getting 200k a year but I'm sure you'll rise your 30k expenses past 250k in no time.
 
I cant believe how petty people have become.

Has he broken the law? I don't think so. So move along and do something for others or STFU!
 
Stoly said:
Ok so you suck at math :p:p:

No matter how much money you got, once you stop having an income it will go away fast.

You may be getting 200k a year but I'm sure you'll rise your 30k expenses past 250k in no time.
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Do people ever think about what they say?

Yes there is an amount of money that is enough for each person.

Yes just like EVERYTHING in life bad choices can ruin ANYTHING. DUH.

I make less than 200k a year (considerably less) and I pay off my CC each month and the only dept I have is a home. I have more money coming in than going out. I can do everything I want without too much worry. As a matter of fact I plan my spending around disposable funds, less debt more disposable to enough myself.

I will agree I see many making poor choices, buying $600 a month Cadillac when bills are tight, constantly spending on "treat" my-selves, "keep up with the joneses" etc etc I believe this is driven by what made USA so strong... consumerism. People seem never happy with what they have.
 
kbrickley said:
I'm sure you are being sarcastic ... inherited wealth should be the choice of the parents (who earned the money) and not the choice of the children (who have earned nothing) ... the only birthright a child gets is their name (which they can legally change to whatever they want once they reach the age of majority or reach the age of emancipation)
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Yes. It was intended as humor.

I like the idea of keeping money in the family, but don't like the idea of trust fund babies. Basically the guy with the money gets to decide what happens with the money. Simple.
 
variant said:
You need money for investment and growth of business which in turns employees more people. You won't get nearly the cost-benefit just by giving it all away.
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I think some people are missing that he is giving away HIS money, not Facebook money.
 
I think we can use the nuclear scientist example for this. It would be great to have the 50 power plants powering us but since they could hold us hostage if they joined together the president would never give that power to a private industry.
 
lollerwaffle said:
It lowers his tax liability and puts him more in control of how the money is ultimately spent.

So that's probably right along the lines of what some folks like, which is kill any government funding and have private investment instead. However, that's not without problems. Whatever THAT PERSON thinks should be, will be. Instead of the government at least being elected.

Just saying, we can all play 'hate gubmint' but in the end we pay for a government to sustain services we use.
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Thanks for that juvenile bit of mockery. You remind me that while people like you have no shortage of arrogance, you can be snarky in your ignorance which is about all the intellectual effort you can muster.
 
dandirk said:
Yes there is an amount of money that is enough for each person.
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You'd think that makes sense... but no.

People will always want more no matter what.

So right now I can't afford my dream Quad SLI multi monitor super duper mega hyper gaming rig.

If I had 5million I'd have no excuse. What about a new house, a sports car, an iphone 6, sum it up at that money will be gone fast. Thing is you have to "keep the 5 mill or more " to afford a better life style and the only way to do it is to keep having a substancial income.

Having an X amount of money and call it quits just living on interest is not going to cut it.
 
aardvark sandwich said:
Don't care. If he wants to forfeit his child's birthright for an emotional tingling sensation, that is his right.
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You are assuming the terms of the trust aren't that the zuckerberg family manages it for eternity with every one a board member that gets paid a buttload for administering the fund, with the ability to vote the shares, etc.
 
raz-0 said:
You are assuming the terms of the trust aren't that the zuckerberg family manages it for eternity with every one a board member that gets paid a buttload for administering the fund, with the ability to vote the shares, etc.
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good point
 
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