(FOX)–Most people use Facebook on a daily basis. But the popular social media site is receiving a lot of frowns for its recent tax breaks. You won’t believe how much the company paid, or rather didn’t pay.
Facebook’s profits in the United Staets last year were $ 1.1 billion. Their combined federal and state income tax bill was zero dollars. They’re actually going to get a refund of $429 million thanks to one tax deduction for executive stock options.
Robert McIntyre with Citizens For Tax Justice says, “The employees cash in the stock options. And at that point, there’s a tax deduction for the company because even though it didn’t cost Facebook a nickle, the government treats it as wages and they get a deduction for it. And usually it doesn’t wipe out a company’s whole tax bill, although many companies get big breaks from it.”
In coming years, Facebook will get more tax breaks for a total of $3 billion dollars.
Earlier this week, President Obama said that shouldn’t happen
“Save hundreds of billions of dollars by getting rid of tax loopholes and deductions for the well-off and the well-connected, said Obama.
But social media sites like Facebook boosted President Obama’s campaigns in 2008 and 2012 and some experts think that’s why he doesn’t single them out when stumping for tax reform.