# Zuckerbergs mega-donation question **URL:** \ **Category:** Factual Questions\ **Created:** [December 3, 2015, 5:44am UTC](https://boards.straightdope.com/t/zuckerbergs-mega-donation-question/739292 "2015-12-03T05:44:33Z")\ **Posts on this page:** 6\ **Page:** 2
**Author:** ![coremelt](https://avatars.discourse-cdn.com/v4/letter/c/4491bb/32.png) [@coremelt](https://boards.straightdope.com/u/coremelt)\ **Post date:** [December 4, 2015, 3:10am UTC](https://boards.straightdope.com/t/zuckerbergs-mega-donation-question/739292/21 "2015-12-04T03:10:36Z")
Right, so the article was wrong? He only gets a tax deduction for the amount of money that his foundation gives to actual charities? I imagine at some point the Foundation will also set up a charity that they can donate to for activities that would be legal for a charity to do. ---
**Author:** ![Kropotkin](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/kropotkin/32/18045_2.png) [@Kropotkin](https://boards.straightdope.com/u/Kropotkin)\ **Post date:** [December 4, 2015, 4:37am UTC](https://boards.straightdope.com/t/zuckerbergs-mega-donation-question/739292/22 "2015-12-04T04:37:19Z")
Eh, very nice. And how’d he get that money, eh? By exploiting the workers. By hanging on to outdated imperialist dogma which perpetuates the economic and social differences in our society. If there’s ever going to be any progress– ---
**Author:** ![coremelt](https://avatars.discourse-cdn.com/v4/letter/c/4491bb/32.png) [@coremelt](https://boards.straightdope.com/u/coremelt)\ **Post date:** [December 4, 2015, 5:28am UTC](https://boards.straightdope.com/t/zuckerbergs-mega-donation-question/739292/23 "2015-12-04T05:28:17Z")
If any workers in history could never complain of being exploited its probably Facebook and Google which are extremely hard to get into and pay very well. > **[Meta: Employee Benefits and Perks](https://www.glassdoor.com/Benefits/Facebook-US-Benefits-EI_IE40772.0,8_IL.9,11_IN1.htm)** > > Meta benefits and perks, including insurance benefits, retirement benefits, and vacation policy. Reported anonymously by Meta employees. ---
**Author:** ![don\_t\_ask](https://avatars.discourse-cdn.com/v4/letter/d/e68b1a/32.png) [@don\_t\_ask](https://boards.straightdope.com/u/don_t_ask)\ **Post date:** [December 6, 2015, 9:00am UTC](https://boards.straightdope.com/t/zuckerbergs-mega-donation-question/739292/25 "2015-12-06T09:00:44Z")
> [@Kropotkin](#): > > Eh, very nice. And how’d he get that money, eh? By exploiting the workers. By hanging on to outdated imperialist dogma which perpetuates the economic and social differences in our society. If there’s ever going to be any progress– Not according to [How Mark Zuckerberg’s Altruism Helps Himself](http://www.propublica.org/article/how-mark-zuckerbergs-altruism-helps-himself) > [@](#): > > In covering the event, many commentators praised the size and percentage of the gift … Few news outlets initially considered the tax implications of Zuckerberg’s plan. A Wall Street Journal article didn’t mention taxes at all. > > So what are the tax implications?..have the LLC donate the appreciated shares to charity, which would generate a deduction at fair market value of the stock without triggering any tax. > > But what this means is that he amassed one of the greatest fortunes in the world — and is likely never to pay any taxes on it. Any time a superwealthy plutocrat makes a charitable donation, the public ought to be reminded that this is how our tax system works. The superwealthy buy great public relations and adulation for donations that minimize their taxes. > > Instead of lavishing praise on Zuckerberg for having issued a news release with a promise, this should be an occasion to mull what kind of society we want to live in. Who should fund our general societal needs and how? Charities rarely fund quotidian yet vital needs. > > Maybe Zuckerberg will make wonderful decisions, ones I would personally be happy with. Maybe not. He blew his $100 million donation to the Newark school system, as Dale Russakoff detailed in her recent book, “The Prize: Who’s in Charge of America’s Schools?” > > Mega-donations, assuming Zuckerberg makes good on his pledge, are explicit acknowledgments that the money should be plowed back into society. They are tacit acknowledgments that no one could ever possibly spend $45 billion on himself or his family, and that the money isn’t really “his,” in a fundamental sense. Because that is the case, society can’t rely on the beneficence and enlightenment of the superwealthy to realize this individually. We need to take a portion uniformly — some kind of tax on wealth. > > The point is that we are turning into a society of oligarchs. And I am not as excited as some to welcome the new Silicon Valley overlords. ---
**Author:** ![Francis\_Vaughan](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/francis_vaughan/32/3093_2.png) [@Francis\_Vaughan](https://boards.straightdope.com/u/Francis_Vaughan)\ **Post date:** [December 6, 2015, 11:29am UTC](https://boards.straightdope.com/t/zuckerbergs-mega-donation-question/739292/26 "2015-12-06T11:29:26Z")
The difficulty with all the commentary is that there is an element of damned of one does, and damned if one doesn’t. Full non-profit charitable entities are not always the pure white honest entities one might wish them to be. The depressing reality is that many become self perpetuating entities that are run by a professional board and executives that can be far more focussed on maintaining very high board fees and executive salaries. All they need do is ensure that they meet the letter of the law on how they operate. Aggressive action to solve real problems is not always high on the agenda. If it is your money, and you sincerely want to make a real difference, not just move money about, what Zuk is doing is clearly the right answer. Sure, he may make a bad call from time to time, everyone does. It is however more likely that in the long run he makes more good calls that actually make a difference, rather just handing the money over to a set of professional charity managers, who may well choose to simply give the statutory 5% to other non-profits that are run by their mates in the non-profit management business. (Colour me cynical here, but the problem with the rise of the mega charity is a worldwide issue.) As noted above. Zuk can direct the foundation do things a charity cannot. Investing in areas that may make a difference way past just handing over money is clearly something that any rich techno-geek will want to do. Inventing in say: renewable energy technology, third world initiatives such as micro-loans, infrastructure projects and so on. Just handing over money is rarely the answer in enabling people to improve their lives. Yet charities are restricted from engaging in more interesting strategies. The criticisms of Zuk’s actions do seem to smack of the usual jealousy of the rich. No matter what he does there will be something to criticise. Especially for those the hang on to outdated dogmas of all kinds. It also tends to have a very naive idea of how and where the money in question came into existence, and just why Zuk is constrained in how can actually do this. ---
**Author:** ![friedo](https://avatars.discourse-cdn.com/v4/letter/f/8edcca/32.png) [@friedo](https://boards.straightdope.com/u/friedo)\ **Post date:** [December 7, 2015, 5:35pm UTC](https://boards.straightdope.com/t/zuckerbergs-mega-donation-question/739292/27 "2015-12-07T17:35:58Z")
Here is [another good article](http://www.nytimes.com/2015/12/08/upshot/why-its-too-soon-to-sour-on-the-zuckerberg-charity-plan.html?_r=0) from the NY Times that goes into a bit more detail about the implications of using the LLC. As stated above, it’s neither a tax dodge nor a loophole; in fact their potential tax liability is exactly the same if they hold the stock personally or in the LLC. All it does is provide them an organizational tool for managing this wealth how they see fit. > [@](#): > > The financial transaction itself has few implications, positive or negative. Mr. Zuckerberg, Facebook’s co-founder and chief executive, and Ms. Chan own some assets, and now they are giving those assets to an L.L.C. that they own. **The Chan Zuckerberg Initiative, L.L.C., will not pay taxes directly, but if it has income (as the I.R.S. defines income) its owners — that is, Mr. Zuckerberg and Ms. Chan — will have to pay tax on it.** > > **If the initiative owns Facebook stock that appreciates, it will be able to defer tax on that appreciation until it sells the stock** , perhaps for many years — **just as the couple could do if they owned the stock directly**. But this probably won’t shield all their wealth from tax forever, because **as Facebook becomes a mature company it is likely to start paying dividends, on which tax cannot be deferred.** > > \*\*If, in the future, the initiative gives stock away to charity, its owners will get a double bonus — they will pay no tax on the gain on the stock, and they will be allowed deduct the full value of the donated stock against other income they might owe taxes on. That’s a big tax break, but it’s also one Mr. Zuckerberg and Ms. Chan could get simply by holding the stock in their personal capacity and donating it later. \*\* [Previous page](https://boards.straightdope.com/t/zuckerbergs-mega-donation-question/739292.md?page=1)