Once again, Elon Musk decided to tweet some snark at a U.S. Senator over taxes. After Time magazine named Elon, 50, it’s 2021 Person of the Year, Senator Elizabeth Warren quote-tweeted the article with the message, “Let’s change the rigged tax code so The Person of the Year will actually pay taxes and stop freeloading off everyone else.” This comment seemingly triggered Elon, who responded with, “You remind me of when I was a kid and my friend’s angry Mom would just randomly yell at everyone for no reason.” He followed that up with, “Please don’t call the manager on me, Senator Karen.”
Please don’t call the manager on me, Senator Karen 🙏
— Elon Musk (@elonmusk) December 14, 2021
“And if you opened your eyes for 2 seconds, you will realize I will pay more taxes than any American in history this year,” he added. Elon is worth an estimated $251 billion, according to Forbes’ Real Time Billionaires estimate (h/t/ CNN Business.) However, a ProPublica investigation uncovered that he and other billionaires paid little to zero in federal income taxes. Over the years, whenever this issue has come up, Elon has pushed back against these allegations by saying he doesn’t draw a salary from either SpaceX or Tesla (and that Elon’s wealth comes from all the stock he owns in those companies.)
So, why is he going to have a tax bill? Well, 2021 will be a year of separation for Musk. Not only did he and Grimes call it quits in September, but he’ll soon “consciously uncouple” from billions of dollars. Over the past few months, Elon has been exercising almost 15 million stock options and selling millions of shares to cover the taxes related to the transactions, per Bloomberg. The reason why Elon is exercising and selling off so much is that he was given 22.9 million shares of Tesla stock as part of a 2012 compensation package, and those shares will expire next August. If he doesn’t exercise them by then, he will lose them. Right now, CNN projects that his tax bill for 2021 will stand at $7.6 billion. (or roughly 3% of his total estimated worth.)
Elon pays an effective tax rate of 53% on stock options he exercises, and that number came up during his November Twitter spat with Senator Bernie Sanders. “We must demand that the extremely wealthy pay their fair share. Period,” Bernie tweeted on Nov. 13, a perfectly on-brand tweet for the Vermont senator. The following day, a very upset Elon tweeted a response: “I keep forgetting that you’re still alive.” He then added, “Want me to sell more stock, Bernie? Just say the word.” When Senator Sanders didn’t respond, Elon tried to engage him again that following Monday. “Ok, how much do you think is fair? Does 53% seem reasonable?”
During the spat, Elon accused Bernie of being “a taker, not a maker.” Weeks later, at a December 2021 Wall Street Journal summit, Elon railed against “takers” and said that the government should “just delete” all subsidies from the $1 trillion infrastructure bill that President Joe Biden just signed into law (h/t Insider). However, a Los Angeles Times investigation pointed out that Elon’s companies – Tesla Motors, SpaceX, and Solar City – received an estimated $4.9 billion in government support by 2015. The report alleges the companies have received much more since then.