Facebook Owes No Taxes For 2012, Getting Huge Refund Instead
We’ve all heard the argument about who is and who isn’t paying their fair share of taxes. The news report from UPI that Facebook does not owe anything in taxes and is getting a $429 million refund is bound to stoke the fires of those saying that tax loopholes for the very wealthy need to be re-examined. How could a company with pre-tax earnings of over $1 billion not owe any taxes? All legal it seems.
The Citizens For Tax Justice website explains.
Facebook’s income tax refunds stem from the company’s use of a single tax break, that is the tax deductibility of executive stock options. That tax break reduced Facebook’s federal and state income taxes by $1,033 million in 2012, including refunds of earlier years’ taxes of $451 million.
As reported, it is all legal but something is wrong with a tax code that allows those individuals and companies with this kind of financial and political clout to profit not by hard work and innovation but by rules that most of us will never qualify for.