Tesla CEO Elon Musk Donates $5.7 Billion To Charity After Selling Stock
According to the latest SEC filings and a report from the Wall Street Journal, Elon Musk gave roughly $5.7 billion in Tesla shares to an unnamed charity late last year. But who will benefit the most from this?
In late 2021, Tesla CEO Elon Musk sold roughly $16 billion worth of company stock during a time when the price was repeatedly rising. This move will result in one of the largest tax bills in history for the billionaire, according to Musk. However, given that donations made to charities can be deducted from your taxes, the revelation of Musk’s massive charitable gift may alter that.
According to SEC records, a trust received $5.7 billion in donations between November 19 and November 29, 2021, and the payments were made in five installments. The IRS considers stockdonations based on their value at the time of giving, but since Tesla’s share price has plummeted, the same $5.7 billion worth of stock is only worth about $4.4 billion today.
The billionaire’s personal charity foundation and the United Nations World Food Program are the most likely beneficiaries of Elon Musk’s generosity, with the UN food agency in particular making headlines a few weeks ago when its leader said that Musk could save 42 million people from starvation if he relinquished just 2% of his money.
David Beasley, the UN’s executive director for the World Food Program, said in a CNN interview:
“The governments are tapped out. This is when the billionaires need to step up now on a one-time basis—$6 billion to help 42 million people that are literally going to die if we don’t reach them. It’s not complicated,”
Elon Musk said on social media that he’d give to the program if it could end world hunger permanently, which Beasley never claimed was achievable with a one-time gift. The World Food Program would not confirm whether Musk had made any donation to the organization.
The Musk Foundation, which was founded in 2002, is the other possible recipient of Musk’s funds. The Musk Foundation makes grants in the fields of alternative energy research and artificial intelligence development, among other things, but Musk has been extremely tight-fisted when it comes to giving money to his own charity in the past.
According to the Wall Street Journal, however, these donations will “surely” offset Musk’s tax bill for 2021.
Donations of appreciated stock are particularly attractive for wealthy people. The forgone capital gains aren’t taxed. The value of the stock is a charitable deduction, subject to limits. And the stock comes out of the person’s taxable estate.