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Facebook Paid No Income Tax in 2012 Despite More than a Billion in Profits

The company is one of many companies that managed to pay no income tax thanks to loopholes in the tax law.

As we head into the heart of the tax season and try to figure out just how to avoid having to pay in when we file our income tax, we should all be grateful we don’t have a bill the size of a company like, say Facebook, right? Not so, reports the Huffington Post. In fact, despite making pre-tax profits of $1.1 billion, Facebook paid no income tax at all in 2012. And on top of that, it received  $429 million in net tax refunds for the year.

This is as a result of those loopholes that the president talked about getting rid of in his State of the Union speech on Tuesday. Facebook is just one of the corporate giants that is able to reduce its tax burden by accessing these legal loopholes in the U.S. Tax Law. Other companies that do this, the Huffington Post reports reports, include General Electric, Wells Fargo and Boeing.

Facebook is reported to have received this tax benefit by taking advantage of the tax deductibility of executive stock options linked to the social media giant's initial public offering last year. It netted Facebook a total saving of $3.2 billion in taxes, a windfall that it can carry forward to future years.

So is it time for the whole tax code to be overhauled to ensure that everyone does indeed get to pay their fair share?

JoAnn Fuller February 17, 2013 at 12:27 PM
Fairtax.org
Kim Lee February 17, 2013 at 01:47 PM
Wow!
Amy February 17, 2013 at 04:40 PM
Lucky for Facebook. I need a loophole.
ToJo February 18, 2013 at 02:16 PM
The tax code must be scrapped. Any tax system that allows any entity or person to not pay taxes is corrupting. Personal taxes should be progressive, say 10% to 25% with NO deductions, business taxes should be flat with deductions for adding employees in this country and the cost of those employees benefits ONLY. No one wants to pay taxes, however it takes money to support a civilization. I like clean air, clean water, a safe food supply (horse meat anyone??), protection against the predators among us and a reasonable safety net for the old and needy. These cost money. We don't kick our old and sick to the edge of the herd so the lions can get them, this is what makes us human.

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