Sky Moore, Partner in the firm's Tax Group, authored, "Elon Musk May Owe 57 Percent Tax on Tesla Options in 2024" in Tax Notes.

Excerpt:

Elon Musk may owe 57 percent tax attributable to the value of his Tesla stock options that were approved by the shareholder vote on June 13. He was originally granted the options in 2018, but on January 30, 2024, a Delaware court held that the options had not been validly authorized and expressly rescinded them: “The court last turns to the remedy, concluding that Plaintiff is entitled to rescission of the Grant [of options] in its entirety.”

In response, the Tesla board decided to ratify the prior issuance of the options. The proxy statement sent to Tesla shareholders in advance of the June 13 vote stated that the board had approved that ratification on April 16 subject to shareholder approval, which occurred on June 13.

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Resources

• Tax Notes (PDF)
• Tax Notes (Subscription Required)