Tesla makes revenue, and they have costs. Their revenues are offset by their costs.
Any profit Tesla makes is eventually taxed -- either when Tesla shareholders sell appreciated stock, when the company makes distributions or when they liquidate.
Corporate tax only applies to un-distributed profits carried forward from year to year instead of invested into the business or distributed to shareholders.
Yes and no. It's clearly an abuse of the tax code. But the idea that a company would have different books for the IRS and itself is no different than you probably having a different set of "books" for your household budget and tax filings. They're held to different standards of precision and serve different purposes.
> My labor is turned into profits for my employer and similarly their profit is eventually taxed.
Your labour is tuned into revenue first. There are plenty of companies burning through cash for 10 years before making a single cent of profits.
People also have costs some of which are tax deductible, yet their income is seen to be completely taxed before costs are deducted. In both personal and corporate taxes, some costs are deductible and others not. People understand this.
The point is that people find it a violation of norms how a company can arrange its taxes in a way that a salaried individual basically never can: to basically not pay any taxes while enriching some specific people more than others.
Feels like a fatal flaw in the law if you can bypass paying the corporate taxes in that way.
That is individual tax - not the tax payed by the corporation. Normally the tax is payed twice. Tax from the corporation profits and then the individual employee/shareholder tax based on their income.
I guess you could make a case for double-taxation but... why?
> Individual tax rates in California are as high as like 52%.
Can it also be an effective rate, yes, pretty close anyways.
At these rates, This means the government takes 72 cents out of every dollar of profit.
Payroll tax is the second check you're looking for.
Tesla is almost certainly fucking around. But the concept of taxing corporate profits--versus earnings--is solid. You massively favour high-margin (tech) over low-margin (manufacturing, service, anything with physical assets) and incumbents over new entrants if you tax the top line.
Now what can be called cost is very reasonable question. Clearly dividends or stock buybacks should not be costs. And thus such spending should only come from post tax money...
It does. Dividends and stock buybacks are not tax deductiable [1][2].
[1] https://www.thetaxadviser.com/issues/2022/sep/paying-dividen...
[2] https://www.grantthornton.com/insights/alerts/tax/2024/flash...
That's what SF instituted with Prop C -- only to see an exodus of low margin tech companies.
Then you can also take loans based off of that to make sure you never have to pay taxes again.
> Then you can also take loans based off of that to make sure you never have to pay taxes again.
You can borrow against the after tax amount yes, you'll pay interest on it and when you die, you will pay the capital gains. On your final tax return, you are required to pay taxes on all of the capital gains you up to your departure. This resets the tax basis for your heirs.
But in which jurisdictions is that tax payable, and at what rates?
Net income. The article's $2.3bn 2024 "U.S. income" lines up with Tesla's (global) $2.32bn net income (on $1.6bn operating income) [1].
[1] https://www.cnbc.com/2025/01/29/tesla-tsla-2024-q4-earnings....
Or why do I have to pay taxes instead of nothing because I invest in my company aka me?
But I doubt your employer will be too happily to now pay your salary as an invoice to a subcontractor...
You may find it's easier to just pay tax... Also look up effective tax rate vs actual tax rate...
I know many people who despite having a significant portion of their salary being taxes, when you look at their Revenue and Expenses for a given 12 month period they in fact paid no tax.
Your specific situation may be different, but you aren't a corporation.
Yeah, it's mechanically different from individual income taxes, but in general Americans don't know how taxes work.
I've had coworkers in the past who believed that if you made juuust enough money to enter a new income tax bracket, you'd actually have less take-home than before. They thought that the entire income was taxed at a new rate, instead of just the marginal dollars that spilled into the new bracket.