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This is how Jeff Bezos saved millions in taxes by moving

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This is how Jeff Bezos saved millions in taxes by moving

Lauren Sanchez and Jeff Bezos in Miami for Formula 1 last year. Clive Mason – Formula 1

Jeff Bezos announced his move to Miami last year.

Since his move, he has begun dumping billions of dollars’ worth of Amazon stock.

Thanks to his new address, he avoids paying hundreds of millions in taxes.

This is a machine translation of an article from our US colleagues at Business Insider. It was automatically translated and checked by a real editor.

This story is as old as our convoluted tax code: Rich people will do anything, including moving across the country, to avoid paying taxes.

Jeff Bezos announced in November that he was leaving Washington state, where he has lived for 29 years, and moving to Florida with his fiancée Lauren Sanchez. The couple purchased two properties for $147 million in exclusive Indian Creek Village, an island off Miami known as the “billionaire’s bunker.”

He cited a number of reasons for the move: He wanted to be closer to his parents and the Blue Origin plant in Cape Canaveral, and he and Sanchez love Miami. What he didn’t mention: Florida’s favorable tax law.

But it looks like that also played a role.

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There is no capital gains tax in Florida

Earlier this month, Bezos announced plans to sell 50 million Amazon shares worth about $8.5 billion (about eight billion euros) over the next year. Last week he sold 12 million shares worth more than $2 billion, according to Securities and Exchange Commission filings.

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This means Bezos is returning to his old form. From 1998 to 2021, Bezos sold Amazon shares every year to finance his personal and philanthropic activities. But he stopped doing so in 2022, the same year Washington state introduced a 7 percent capital gains tax on profits of more than $250,000 for residents of that state. In Florida, however, the tax rate for capital gains is zero. In fact, it is one of eight states that does not impose a capital gains tax.

For someone like Bezos who sells billions worth of securities, the difference makes a lot of money. Thanks to his new address in Florida, he could save more than $610 million in state taxes over the course of the year if he continues to sell stocks, CNBC first reported. Through last week’s sales alone, he was able to avoid paying $140 million (around 131 million euros).

Bezos is by no means the only super-rich person who, thanks to Florida’s favorable tax laws, does not have to pay a very small part of his wealth to the state – $610 million (around €570 million) is just 0.3 percent of his net worth ¶gens of 197 billion dollars (about 184 billion euros).

An analysis of 2023 tax data found that Florida and Texas had the most top earners between 2020 and 2021. Billionaires Ken Griffin, Carl Icahn, Daniel Och and Josh Harris have moved to Florida in the past five years.

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Although some, like Griffin – who made millions of dollars for that Fight against tax increases spent on the wealthy – have saidthat lower taxes did not play a role in their move Reports suggested that others, like Icahn and Och, moved to the Sunshine State for tax reasons.

Some might say Bezos is teaching the evergreen state of Washington a lesson, but around a dozen billionaires still live there, including Bill Gates, Steve Ballmer and MacKenzie Scott, Bezos’ ex-wife. And for these super-rich people the saying still applies: Nothing in this world is safe except death and taxes.

Read the original article Business Insider.

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