Question

Jack Dorsey (CEO of Twitter & Square) is donating $1 Billion of stock in Square to support the COVID-19 relief. However, he is doing it through an LLC, not directly to a non-profit to retain control of voting rights with his company and not have to pay capital gains on his donation. Do a bit of research on the topic and especially the ethical aspect of the transactions.

Answer 1

As we all know the news regarding Mr. Jack Dorsey the cheif executive of twitter and square said on tuesday that he has planned to donate $1 billion to relief programs related to the coronavirus. Jack Dorsey said he would put 28% of his wealth in the form of shares into Limited Liability Company or LLC that he had created called start small.

LLC is a path to bulid up between your personal assets and your company's financial liabilities. LLC has certain tax advatages. A donation is the most efficient way to give charitably. On this donation, he got a relief of capital gains it means he donot have to pay tax on this transaction. Donation is way of contribution to reduce capital gains tax liability.

The transaction through LLC are often mostly complicated when attempting to avoid taxation and using limited liability company or LLC could give a relief of taxes and benefits for taxes to the owners. The good aspect for this transaction through LLC is the owner of the company protect his or her personal assets and enjoy much greater flexibility than either a corporation or partnership. The most important fact is, doing the donation through LLC and not have to pay the capital gain on this donation, defines that anyone can easily transfer owenership or shares by thier own choice that enables owners to avoid tranfser and recording taxes and fees. Many owners choose to do transaction through an LLC because they are not familiar with the legal shades and also approach the protection from risk.