Featured Image Credit: YouTube/@AttorneyFredLong
A Youtuber has revealed what would actually happen if Elon Musk gave you $1 billion and it is not what you might expect.
YouTuber and attorney Fred Long uses his platform to give his viewers educational content on both estate planning and trust and estate administration.
In a recent video, Long explained what the tax procedures would look like if the richest man in the world gave you a billion dollars.
In the video description, it detailed: “This video is for educational purposes and uses a fictional example to explore how the IRS views large gifts — and how charitable giving can create meaningful tax savings.
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“What if Elon Musk gave you $1 Billion Dollars? What amount of taxes would have to be paid on that gift? In this video, we explore the tax consequences of receiving a massive personal gift versus what would happen if the same amount were donated to public charities.”
In the video, Long went on to explain: “The federal gift and estate tax rate is 40% so Elon would owe $400 million in gift taxes, that's right, $400 million would be paid to the federal government in tax in this hypothetical gift scenario, so this got me thinking what if some someone like Elon wanted to have an impact without paying so much in taxes?
“If instead of gifting to an individual, Elon gave that billion dollars to public charities, he wouldn’t owe any gift tax because he would be eligible for a charitable deduction for gift tax purposes, plus with certain limitations he would also get a charitable deduction on his personal income tax.
“Under current tax regulations a donor can deduct up to 60% of their adjusted gross income for cash donations to public charities, so let’s say that he has $5 billion in adjusted gross income, because that billion dollar gift is less than 60% of his income he can deduct the full billion saving about $370 million in taxes at the top 37% rate.”
Many people took to the YouTube comment section to share their own reactions on the matter, with one user writing: “Personally if he wants to give me a million dollars I'll take it, sure I will.”
Another said: “I’d sue him and Trump for crimes against humanity.”
A third person commented: “Elon is not a giver.”
And a fourth added: “Are you kidding he won’t give a dime.”
