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Facebook paid no taxes in 2012

Published Feb 18th, 2013 9:35AM EST
Facebook Taxes 2012

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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 an absolute mess, and 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.”

Zach Epstein
Zach Epstein Executive Editor

Zach Epstein has been the Executive Editor at BGR for more than 10 years. He manages BGR’s editorial team and ensures that best practices are adhered to. He also oversees the Ecommerce team and directs the daily flow of all content. Zach first joined BGR in 2007 as a Staff Writer covering business, technology, and entertainment.

His work has been quoted by countless top news organizations, and he was recently named one of the world's top 10 “power mobile influencers” by Forbes. Prior to BGR, Zach worked as an executive in marketing and business development with two private telcos.

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