I can only imagine the heartbreaking trauma these poor rich people are made to suffer when parting with their beloved money to pay taxes. What an earth-shattering tragedy. How do they survive?
Not a big fan since we now only get 2 links a month,
But it would have been easier to relocate to the border in Tahoe than fill out mountains of paperwork; he lives on an estate in a Maui bunker anyway, not spoilt for housing options...
Not very good with building technology; he lost 80 billion on a nonexistent metaverse fail. Is that now a tax loss?
I'll take your word for it, but I must have missed that.
(I thought it was just archive.today that was untrustworthy—it seems it's also archive.ph and archive.is, and perhaps others. It would be nice if there were a substitute already.)
Is this hyperbole? Or did you actually look into details? I'm curious about your understanding of what happened here. I believe this is an exchange of share types, but I could be mistaken.
They gave every shareholder a non-voting share for each share they own. Effectively a stock split. Zuck can sell his non-voting shares to pay the tax without losing control of the company.
In some sense Meta has doubled the voting power of Zuckerberg's shares. Previously he had X shares with 10X votes. Now he has 2X shares, can sell half of them for close to the market price, and still keep his 10X votes.
"The board establishes a new Class C share type with no votes. It also announces a one-time dividend of a Class C share for each Class A and B share outstanding".
You changed your post. You mentioned Levine. I don't know what else you changed. But Levine posted this in his article. I don't know where you're getting the part where he can sell half his shares.
"If Zuckerberg needs to pay taxes, he can sell his new zero-vote shares to raise money without diluting his voting rights. Not too many: He can “immediately sell or transfer up to 20% of the shares of Class C common stock that he receives in the Dividend, representing 10% of his overall economic stake in the Company, for any reason,” but the board “negotiated for and obtained Mr. Zuckerberg’s agreement that 80% of the shares of Class C common stock that he receives in the Dividend be subject to the Stapling Condition,” under which he can’t sell those no-vote shares without also selling some high-vote shares. The basic deal remains intact — he needs to own a meaningful chunk of shares to keep voting control — but there’s a liquidity buffer for taxes."
I understand it's a move to keep his voting shares but... Why would the board care if the Zuck was to sell his big house in California? What was the threat to Meta/the board?
He owns enough shares that there would be a significant change in the supply/demand ratio when California forces him to sell to meet his tax burden. That would tank the stock price because way too much supply when he tries to sell.
So basically meta stepped in to say they'd pay a portion of zucks tax burden to protect the supply/demand ratio of the stock, which protects the overall market price of Facebook stock and the valuation of the company as a whole.
Wealth taxes are inherently stupid in our modern financial system and this is a clear example of why.
Your description of the scenario does not seem to be accurate. He is being gifted a new class of stock so that he does not need to relinquish control of the company for no apparent good reason. I'm indirectly a shareholder of this company through the major stock index inclusion, and I have not been similarly been gifted the same. I hope he pays his CA taxes fairly and as shareholders we are made whole by this chicanery.
> The solution is a quasi-share split: Meta is creating a new Class C stock, with zero votes per share. Shareholders will get one no-vote Class C share for every one-vote Class A share or 10-vote Class B share that they currently own. Zuckerberg, who owns about 341 million high-vote Class B shares (and like 1 million low-vote shares), will get about 342 million new zero-vote shares; all the other shareholders, who own about 3.4 billion low-vote shares, will get 3.4 billion new no-vote shares.
And in the footnotes:
> Stock exchange rules prevent already-public companies from creating new high-vote shares, or from distributing new low/zero-vote shares in non-proportional ways. So Meta could not, for instance, give Zuckerberg a big dividend of voting shares while giving everyone else a big dividend of zero-vote shares. But this mechanism — giving everyone the same dividend of zero-voting shares — works.
> Wealth taxes are inherently stupid in our modern financial system
"our modern financial system" is what is left of a reasonable but by now largely dismantled financial system that used to exist between roughly the 1930s and 1980s.
The entire phrase "Wealth taxes are inherently stupid in our modern financial system" has "throwing up my hands" and "there's nothing we can possibly do" written all over it. The financial system is a societal construct, not a natural constant like, say, the speed of light.
A company that's grown large enough to make its shareholders worth multiple hundred billions of dollars is itself too large.
One of the bigger failings of the US government over the last half century is allowing corporations to grow and merge their way to become as large as many have. Stronger enforcement of anti-trust would have both significantly reduced wealth inequality in this country as well as siphoned off much of the growing political power corporations have relative to regular citizens.
Companies are able to get large simply because of technology the people on HN have built enables scaling. There is no point having more than one Amazon, and a lot of conveniences that come from Amazon’s scale.
But we do have more than one Amazon. Both on the retail and web services sides there are multiple competitors within an order of magnitude on revenue.
There is some reason to think that personal AI agents like Meta Muse will disrupt Amazon's retail business. Amazon currently blocks those bots and doesn't seem to have a strategy to address them.
Like all the mom & pop stores that went out of business? Like all the little companies they rip products off of and then put their own ahead in the listings?
Monopolies are not good things. I've been boycotting Amazon for almost 10 years, you can too.
We might explore breaking up the data centers from the software lines of business across Google, Amazon, Microsoft, Meta, and more. We have become enamored with vertical integration and acquisitions to the determent of vibrancy in our economy.
OK, to be more precise: it would still have a market cap of "multiple hundred billions of dollars" if it never acquired or merged with any other companies.
It's arguable how much of Facebook's current size is a result of natural growth versus what it's gained through said mergers and acquisitions. I'm far more concerned about the fact it's a trillion-dollar company and how large a proportion of people exclusively get their news and other facts from Facebook.
>The company is in desperate need of splitting up.
Walk me through that. In 1999, some people proposed splitting up Microsoft. One spinoff would own Internet Explorer, another would own the office suite, a third would own Windows.
You could spin off Instagram and Whatsapp, but after you do that, Facebook is still really big -- worth many 100s of billions. How to split that up?
Every user east of the Mississippi ends up in Facebook East and every user to the west in Facebook West??
Keep it private? Then there are no shares, and no need to worry about losing control of your company.
Pick one: total and complete control over your company, or give it up to the market. Why should owners get the best of both worlds, and at this point trillions of capital themselves?
There are still shares when the company is private. If you don’t want there to be shares, you must not have partners, take investment, or use equity based compensation for employees. Not exactly conducive to building a successful company.
isolay 28 minutes ago
minimaxa 1 day ago
But it would have been easier to relocate to the border in Tahoe than fill out mountains of paperwork; he lives on an estate in a Maui bunker anyway, not spoilt for housing options...
Not very good with building technology; he lost 80 billion on a nonexistent metaverse fail. Is that now a tax loss?
paaloeye 1 day ago
dboreham 1 day ago
gexla 1 day ago
https://www.sec.gov/Archives/edgar/data/1326801/000162828026...
NOTE: Look for "Founder Alignment Agreement" in the above doc as an example if you're doing a quick scan.
https://www.sec.gov/Archives/edgar/data/1326801/000162828026...
https://investor.atmeta.com/investor-news/press-release-deta...
gnabgib 1 day ago
Guardian: Meta strikes deal with Zuckerberg to protect him from California wealth tax (39 points, 2 days ago, 33 comments) https://news.ycombinator.com/item?id=50193581
Wired: Mark Zuckerberg Agrees to Stay in California Despite Billionaires' Tax Measure (5 points, 2 days ago, 3 comments) https://news.ycombinator.com/item?id=50188801
Telegraph: Meta strikes deal to protect Zuckerberg from California billionaire tax (9 points, 2 days ago) https://news.ycombinator.com/item?id=50191129
WSJ: Mark Zuckerberg Threatened to Leave California. Meta’s Board Cut Him a Deal (4 points, 2 days ago) https://news.ycombinator.com/item?id=50193052 (30 points, 1 day ago, 40 comments) https://news.ycombinator.com/item?id=50199284
JKCalhoun 1 day ago
bl4kers 1 day ago
isolay 24 minutes ago
JKCalhoun 20 hours ago
(I thought it was just archive.today that was untrustworthy—it seems it's also archive.ph and archive.is, and perhaps others. It would be nice if there were a substitute already.)
triceratops 1 day ago
FWIW I think this is better than avoiding the tax.
gexla 1 day ago
triceratops 1 day ago
In some sense Meta has doubled the voting power of Zuckerberg's shares. Previously he had X shares with 10X votes. Now he has 2X shares, can sell half of them for close to the market price, and still keep his 10X votes.
gexla 1 day ago
https://www.sec.gov/Archives/edgar/data/1326801/000162828026...
triceratops 1 day ago
"The board establishes a new Class C share type with no votes. It also announces a one-time dividend of a Class C share for each Class A and B share outstanding".
Please tell me what I got wrong.
gexla 1 day ago
"If Zuckerberg needs to pay taxes, he can sell his new zero-vote shares to raise money without diluting his voting rights. Not too many: He can “immediately sell or transfer up to 20% of the shares of Class C common stock that he receives in the Dividend, representing 10% of his overall economic stake in the Company, for any reason,” but the board “negotiated for and obtained Mr. Zuckerberg’s agreement that 80% of the shares of Class C common stock that he receives in the Dividend be subject to the Stapling Condition,” under which he can’t sell those no-vote shares without also selling some high-vote shares. The basic deal remains intact — he needs to own a meaningful chunk of shares to keep voting control — but there’s a liquidity buffer for taxes."
triceratops 1 day ago
On the other hand, once the non-voting shares exist, he's going to sell them some day.
ChrisArchitect 1 day ago
https://news.ycombinator.com/item?id=50193581
TacticalCoder 1 day ago
throwaway9876g 1 day ago
So basically meta stepped in to say they'd pay a portion of zucks tax burden to protect the supply/demand ratio of the stock, which protects the overall market price of Facebook stock and the valuation of the company as a whole.
Wealth taxes are inherently stupid in our modern financial system and this is a clear example of why.
bickfordb 1 day ago
Zarel 1 day ago
https://www.bloomberg.com/opinion/newsletters/2026-10-22/zuc...
> The solution is a quasi-share split: Meta is creating a new Class C stock, with zero votes per share. Shareholders will get one no-vote Class C share for every one-vote Class A share or 10-vote Class B share that they currently own. Zuckerberg, who owns about 341 million high-vote Class B shares (and like 1 million low-vote shares), will get about 342 million new zero-vote shares; all the other shareholders, who own about 3.4 billion low-vote shares, will get 3.4 billion new no-vote shares.
And in the footnotes:
> Stock exchange rules prevent already-public companies from creating new high-vote shares, or from distributing new low/zero-vote shares in non-proportional ways. So Meta could not, for instance, give Zuckerberg a big dividend of voting shares while giving everyone else a big dividend of zero-vote shares. But this mechanism — giving everyone the same dividend of zero-voting shares — works.
bickfordb 4 hours ago
ks2048 1 day ago
DemocracyFTW2 1 day ago
"our modern financial system" is what is left of a reasonable but by now largely dismantled financial system that used to exist between roughly the 1930s and 1980s.
The entire phrase "Wealth taxes are inherently stupid in our modern financial system" has "throwing up my hands" and "there's nothing we can possibly do" written all over it. The financial system is a societal construct, not a natural constant like, say, the speed of light.
If not "wealth taxes", then what? Poverty taxes?
surgical_fire 23 hours ago
We are on HN. Do you have any doubts about the demographic here would prefer?
Gotta brown nose those corporate overlords.
whatisthiseven 1 day ago
It isn't stupid. Multi hundred billionaires shouldn't exist. Then this wouldn't be a "problem".
rayiner 1 day ago
atmavatar 1 day ago
One of the bigger failings of the US government over the last half century is allowing corporations to grow and merge their way to become as large as many have. Stronger enforcement of anti-trust would have both significantly reduced wealth inequality in this country as well as siphoned off much of the growing political power corporations have relative to regular citizens.
rayiner 20 hours ago
nradov 18 hours ago
There is some reason to think that personal AI agents like Meta Muse will disrupt Amazon's retail business. Amazon currently blocks those bots and doesn't seem to have a strategy to address them.
verdverm 19 hours ago
Monopolies are not good things. I've been boycotting Amazon for almost 10 years, you can too.
We might explore breaking up the data centers from the software lines of business across Google, Amazon, Microsoft, Meta, and more. We have become enamored with vertical integration and acquisitions to the determent of vibrancy in our economy.
hollerith 1 day ago
OK, to be more precise: it would still have a market cap of "multiple hundred billions of dollars" if it never acquired or merged with any other companies.
pseudalopex 20 hours ago
atmavatar 7 hours ago
It's arguable how much of Facebook's current size is a result of natural growth versus what it's gained through said mergers and acquisitions. I'm far more concerned about the fact it's a trillion-dollar company and how large a proportion of people exclusively get their news and other facts from Facebook.
The company is in desperate need of splitting up.
hollerith 7 hours ago
Walk me through that. In 1999, some people proposed splitting up Microsoft. One spinoff would own Internet Explorer, another would own the office suite, a third would own Windows.
You could spin off Instagram and Whatsapp, but after you do that, Facebook is still really big -- worth many 100s of billions. How to split that up?
Every user east of the Mississippi ends up in Facebook East and every user to the west in Facebook West??
whatisthiseven 22 hours ago
Pick one: total and complete control over your company, or give it up to the market. Why should owners get the best of both worlds, and at this point trillions of capital themselves?
xyzzyz 20 hours ago
throwaway9876g 1 day ago
Honestly if any one has more than $999 the government should take it from them.