Few days ago, apart from announcing the birth of his daughter, Facebook Founder Mark Zuckerberg and his wife Priscilla Chan declared that they would donate 99 percent of their share, valued at $45 billion as of today.
For this, Zuckerberg did not set up a charitable foundation but he created a limited liability company (LLC), which has already reaped many benefits as public relations firm.
Although Zuckerberg was lauded first, later he came under scrutiny for just moving money from one firm to the other. Some even opined that Mark is planning to get tax benefits with this move.
In a follow-up post on his Facebook page, Zuckerberg explained that his new venture isn’t going to give him tax benefits and it was in no way intended to make profit for him.
“By using an LLC instead of a traditional foundation, we receive no tax benefit from transferring our shares to the Chan Zuckerberg Initiative, but we gain flexibility to execute our mission more effectively. In fact, if we transferred our shares to a traditional foundation, then we would have received an immediate tax benefit, but by using an LLC we do not. And just like everyone else, we will pay capital gains taxes when our shares are sold by the LLC.” Posted Zuckerberg.
The Chan Zuckerberg Initiative plans to focus on areas like education and disease.
