Facebook receives $429 million federal tax refund for 2012By Mason White 6:28 AM February 17, 2013
|Obama and Zuckerberg|
By: Debbie Gross
(Scroll down for video) Just after U.S. citizens learned that taxes are going up for virtually everyone, it was discovered that facebook will actually receive hundreds of millions of dollars in federal tax refunds, according to press reports in the United States.
February, might be the worst month of the year as the cold temperatures is topped of with tax filings for many U.S. taxpayers. However, many people were left scratching their heads when they heard how facebook is receiving hundreds of millions in tax refunds this year.
A tax watchdog organization brought an interesting little piece of information to the public’s attention about facebook. Because of the way Facebook treats stock options distributed to investors and employees in lieu of cash compensation on their balance sheets, the company is able to claim the payments as tax liabilities worth hundreds of millions of dollars when the reality is that they are getting paid.
You will not find any mention of the tax refund of $429 million in the financial statements of facebook. In fact, the company said it had a federal tax liability of $559 million in 2012. But that tax debt was not in the form of a cash payment.
In a note, the company also said it had a $1.03 billion excess tax benefit last year in relation to exercising of stock options and other equity awards. That benefit is what flipped the federal tax liability into a huge refund.
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