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Zuckerberg Agrees to Stay in California for Eight Years
Confirmed
In Short: Meta CEO Mark Zuckerberg has agreed to stay in California for eight years, despite considering a move due to a proposed billionaire tax, according to a securities filing.
Meta CEO Mark Zuckerberg has agreed to stay in California for eight years, despite considering a move due to a proposed billionaire tax, according to a securities filing.
Zuckerberg told Meta's board he was evaluating a move out of California because of Proposition 40, a ballot measure that would impose a one-time tax of up to 5% on residents worth more than $1 billion.
Under the final deal, Zuckerberg commits to remain a resident of California, or wherever Meta has its headquarters, for eight years, absent 'material unforeseen circumstances.'
Entities linked to Zuckerberg and his wife, Priscilla Chan, which hold a majority of the votes, approved the change, so no shareholder vote is needed.
Zuckerberg can immediately sell 20% of the Class C shares he receives, representing 10% of his overall economic stake in the company, potentially allowing him to pay the tax without giving up voting control.
The company said Zuckerberg had been granted a financial incentive to stay in California and continue leading the company for the next eight years, despite the risk of a 'significant, multi-billion dollar tax payment.'
Zuckerberg emphasized the role of AI in Meta's vision during the Meta Connect conference in Menlo Park, California, on September 23.
Zuckerberg predicted that smart glasses will encroach on the markets for conventional eyeglasses and sunglasses, and the company unveiled a host of new products at its annual conference.
Zuckerberg's holdings are made up of mostly Class B shares, which carry 10 votes per share, maintaining his majority control.
Zuckerberg told Meta he was considering moving his primary residence out of California because the measure could force him to sell voting shares to pay it.
The social media firm made the disclosures about Zuckerberg’s threats to offload his $110 million Palo Alto compound and establish residency outside the Golden State in a 109-page Securities and Exchange Commission filing posted Wednesday.
What this adds
Zuckerberg's commitment to stay in California is part of a broader strategy to maintain control over Meta and avoid significant tax payments.
What's confirmed
- Zuckerberg, the company's co-founder and chief executive, had considered moving his main residence out of California because of Proposition 40, a ballot measure that would impose a one-time tax of up to 5% on residents worth more than $1 billion.
- The company said Zuckerberg had been granted a financial incentive to stay in California and continue leading the company for the next eight years, despite the risk of a "significant, multi-billion dollar tax payment."
- Zuckerberg committed to stay in California for eight years and can sell 20% of new non-voting Meta stock to cover a tax Meta $META Platforms entered into an agreement with CEO Mark Zuckerberg on Oct. 19 that commits him to remain a California resident for eight years, after he told the company’s board he was evaluating a move out of the state over a proposed wealth tax.
What's still developing
- Meta just broke its open-source religion to charge developers for AI, and Zuckerberg is betting a $145 billion infrastructure gamble on a pricing strategy that undercuts every major rival.
- Meta announced the deal on Wednesday in a securities filing that coincided with its quarterly earnings report, where it said it would offer a new class of nonvoting shares and give all existing shareholders a one-time bump for every share they own.
- “Mr. Zuckerberg noted that he has taken only a $1 annual salary since 2013 for serving as the Company’s Chief Executive Officer, and he stated that if he needed to pay any such tax by selling down his Class B common stock, the tax liability could be large enough to reduce his voting interest in the Company to approximately 53%,” the filing read.
- Under what Meta called a “Founder Alignment Agreement” with Zuckerberg, he can sell 20 percent of those new shares to help pay any taxes he may owe.
- Meta unveiled a host of new products last night at its annual conference, with Mark Zuckerberg making it clear that the company’s new strategy will focus not only on developing advanced AI models, but also on their use by millions of people in their everyday lives.
- Chief Executive Mark Zuckerberg said removing the camera "opened up entirely new design possibilities," adding that the product "looks like regular glasses."
- Xu disclosed his personal friendship with Zuckerberg but said it wouldn’t impair his judgement.
- In July, Zuckerberg told Kimmitt, who is Meta’s lead independent director, that selling his Class B stock to cover what he might owe for the wealth tax could cut his voting stake back down to 53%.
- Meta said Wednesday that it planned to issue a new class of non-voting Class C common stock in January 2027 to help fund acquisitions and retain top talent while maintaining Zuckerberg's control of the company.
- Read more: 'So be it': California billionaire tax a non-issue for Jensen Huang Assuming Forbes' current estimate of Zuckerberg's net worth at roughly $240 billion is accurate, he would be facing a 5% levy totaling approximately $12 billion, though the measure’s valuation rules would set any actual bill.
- Zuckerberg is permitted to unload 20% of his Class C allotment, a slice equal to 10% of his economic ownership, to cover any bill that California Proposition 40 might produce, Meta said in a separate information statement.
- Many wealthy individuals, including Zuckerberg, currently avoid significant tax payments by borrowing against their shares and taking low salaries—$1 annually in the Meta CEO’s case.