It’s shaping up to be another multi-billion dollar year for Facebook, but don’t expect the social networking site to pay it forward: according to a new analysis, the website will pay no taxes this year and will instead likely receive a federal refund.
That’s according to Sen. Tom Coburn (R-Oklahoma), who on Tuesday this week released the 2013 edition of his annual “Wastebook” report detailing instances of what he considers unnecessary government spending.
“When it comes to spending your money, those in Washington tend to see no waste, speak no waste and cut no waste,” Coburn writes in the introduction to this year’s 177-page report.
In 2013, Coburn recalls, millions of dollars in funds were wasted on frivolous projects, while at the same time members of Congress were saying “yes” to a sequestration plan that some insist is drastically weakening the national security of the United States by slashing funds for the Department of Defense.
There’s a $124,955 3D printer that NASA will use to make pizzas, Coburn notes, and millions spent on hyping government endeavors by way of expensive contracts cut with Hollywood studios. But instead of collecting taxes from one of the country’s top businesses — and one enjoyed by almost everyone — the government will likely give money back to Facebook in 2013, Coburn claims.
Last year, the senator says, “one of America’s largest companies avoided paying federal or state income taxes, and is poised to do so again this year. In fact, they will likely receive a check from the federal government in the form of a tax refund.”
“Despite bringing in more than $1 billion in US pretax profits last year, the social-media giant Facebook reported a combined $429 million refund from their federal and state tax filings,” he continues, including roughly $295 million from Uncle Sam.
According to Coburn’s report, last year Facebook relied on an employee stock option tax deduction to lower the amount of owed income taxes by around $1.03 billion.
“By providing stock options as a major form of their compensation, to date Facebook has claimed $3.2 billion in federal and state stock option deductions, $1.03 billion of which was used to offset their total US pretax profit of $1.1 billion in 2012 and $429 million was refunded from its 2010 and 2011 tax bills,” he says.
“The remaining $2.17 billion in stock option tax deductions can now be carried forward by the company and used to offset future tax liabilities,” he says. “This rollover, in addition to currently outstanding employee stock options, may once again make this year’s tax bill disappear.”
Coburn writes there is reason to believe Facebook will have the same success this year as they did in 2012, when they were refunded almost $300 million. Meanwhile, he writes elsewhere in the report, Uncle Sam has been issuing other arguably unnecessary paychecks, including the one that will ideally help a contractor create a 3D-printed pizza pie. That endeavor, Coburn notes, is earmarked separately from the $1 million already put aside to be used for the nation’s Martian food development budget.