Post-Reveal Stock Price

[silentRider]

Great point. This may be a good time for me to learn about options. As I understand it a Put would do the same thing and I don't need to fool with my existing stock. I'm just doing this to learn and am not risking any more than I can "comfortably" lose.

That approach will serve you well!

 

[Crissa]

Good points! Looking at complaints that Elon avoided paying taxes for years on a more fundamental level, I never understood all the hate directed his way. I mean look at the facts:

1) Elon didn't write the tax code.
2) Elon didn't lobby for the tax code to be the way it is.
3) Elon has always paid all taxes that were due from him.
4) Elon did not construct any artificial tax avoidance schemes, legal or illegal (unlike most billionaires).
5) I don't recall hearing of anyone paying taxes that were not yet due.

Yet still he was attacked. I think it goes to show that people don't like people who are so much better at generating wealth than they are. People hate extremely productive people because it makes them look slothful and lacking talent in comparison. People don't like to feel insignificant.

Society needs smart people like Elon who are not afraid to roll up their sleeves and make great things happen.

I think point number 4 is the biggest one, but also - he was actually paying taxes at a rate like any other engineer, as earned income, instead of unearned income (which is inexplicably less).

So he was always paying taxes, except the year his companies lost money and he didn't take a paycheck.

-Crissa

 

[HaulingAss]

I think point number 4 is the biggest one, but also - he was actually paying taxes at a rate like any other engineer, as earned income, instead of unearned income (which is inexplicably less).

So he was always paying taxes, except the year his companies lost money and he didn't take a paycheck.

-Crissa

Not really. For most of Elon's tenure as CEO, he was paid the minimum wage required by California law. Whether his companies made or lost money in any given year had no direct bearing on Elon's annual income. He has never collected any salary at SpaceX, to my knowledge.

Any minimum wage that Tesla was required to pay Elon is insignificant to this discussion.

 

[HaulingAss]

Great point. This may be a good time for me to learn about options. As I understand it a Put would do the same thing and I don't need to fool with my existing stock. I'm just doing this to learn and am not risking any more than I can "comfortably" lose.

You had better talk to your accountant (and hope he/she is familar with the details of the Wash Rule and past IRS cases involving stock and the underlying options and the Wash Rule).

My understanding, is that the IRS will treat options and the underlying stock as one and the same for purposes of the Wash Rule. In otherwords, you cannot conveniently avoid the wash rule by trading options of the underlying stock. It has to do with the IRS treating them as being "substantially identical", so the same 30 days before and after will apply.

Some people are fooled because their broker is only required to track buys and sells of the same CUSIP with regard to the Wash Rule. However, the taxpayer is ultimately responsible for accounting for all their trades (as well as their spouses). Yes, the IRS expects you to have your big boy pants on and doesn't offer any leniancy due to ignorance. If you make a mistake of interpretation in your favor, you will stil have to pay the penalties, but you will almost certainly not be charged criminally when you or your accountant are found to have details such as this wrong on your return.

And all this ignores the jeopardy of trades like this impacting whether gains are taxed as long- or short-term gains. It can make a huge difference to your tax bill, depending upon your particular circumstances.

 

[Crissa]

Not really. For most of Elon's tenure as CEO, he was paid...

...Via a salary from SpaceX. He 'failed' to cash his checks from Tesla.

We're talking his taxes, not Tesla, here. He only paid taxes when he actually put cash in his accounts.

-Crissa

 

[Scott Beall]

Yes, the IRS expects you to have your big boy pants on and doesn't offer any leniancy due to ignorance.

LOL Don't I know it!.

Thanks for the great advice. I didn't realize that options would be treated the same. My understanding of the wash rule (researching it this week) it that these short-term trades are legal and fine with the IRS as long as you don't take the sale as a loss on your taxes. In my case the stock I'd sell has appreciated. BUT I will run it by my CPA.

I originally bought TSLA to put some money aside for my Cybertruck and the stock has done well for me this year. I do believe that it is a solid long term stock. Elon is using the car company to finance the development of technology that will change the world. As long as that tech remains owned by Tesla, the future of the company and the stock is bright.

Note: For those who read this under the What's New tab. It's posted in the "General Tesla News and TSLA Investing Discussions" forum so it's not as off-topic as it may seem, IMO.

 

[HaulingAss]

...Via a salary from SpaceX. He 'failed' to cash his checks from Tesla.

We're talking his taxes, not Tesla, here. He only paid taxes when he actually put cash in his accounts.

-Crissa

Elon doesn't have a "salary" at SpaceX, it's all just stock-based compensation. You will find "news" articles talking about Elon's "salary" at SpaceX, but they are just plain wrong.

 

[Crissa]

Elon doesn't have a "salary" at SpaceX, it's all just stock-based compensation. You will find "news" articles talking about Elon's "salary" at SpaceX, but they are just plain wrong.

We're talking past, and in the past, he took a salary. He had no problem taking a salary from a company that was covering its bills.

-Crissa