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Many Outraged that Facebook Will Pay No Taxes for 2012

Many Outraged that Facebook Will Pay No Taxes for 2012

by Stephen BrownFebruary 27, 2013

 

2012 was a big year for Facebook (FB). The company’s initial public offering last May was the largest Internet IPO in history even though it was poorly handled, Facebook managed record profits of roughly $1 billion for the full year. Despite its huge profit in 2012, Facebook will pay no federal or state taxes on its income — in fact it will get a $429 million refund instead, thanks to a tax reduction for executive stock options. Fox News reports that Facebook will continue to get huge tax breaks totaling about $3 billion in the coming years, as well.

“The employees cash in stock options, and at that point there is tax deduction for the company,” Robert McIntyre of watchdog group Citizens for Tax Justice told Fox News during an interview. “Because even though it doesn’t cost Facebook a nickel, the government treats it as wages and they get a deduction for it. And usually it doesn’t wipe out companies whole tax bill, although many companies get big breaks from it.”

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About The Author
Stephen Brown
Stephen Brown @SteveBTech is a Technology Entrepreneur, & Int'l CES Judge. Along with being the founder of DigiLyfe, and Nubby.co, he is the founder of DigitalAfro.com, & StemStars.org an organization that teaches K-12 Students Science & Technology.

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