May 17, 2022

 Elon Musk hasn’t been a major charitable giver in comparison to his massive fortune, and at the time of publication it was estimated at $246 billion. However, a new Securities and Exchange Commission report that was released Monday evening disclosed that the CEO transferred around five millions Tesla shares during November which was worth $5.7 billion at the moment and in a gift to “charity.” In the event that this is the report is true, this is an amount equal to 2.3 percent of his wealth. It’s not an enormous amount, however, it is more than 20 times the amount he’s prior to that.

 The filing was first reported it, there was speculation that Musk, the world’s most successful businessman–had donated a huge sum towards the United Nations’ World Food Programme (WFP). The timing is as follows the following: One month prior to the transfer of shares to the WFP in November, Musk tweeted that he would donate an amount of $6 billion to organization if the organization could provide “exactly the ways in which $6 billion could solve the world’s food insecurity.” (Some believed that Musk was, who has a had a tradition of tweeting smugly in his tweets, was playing games.) However, the WFP hasn’t received an offer, as it was reported by Forbes one son on Tuesday. The other charities have not made announcements about gifts, neither, nor Musk has not responded to numerous requests for clarification.

 However, it’s not yet gone into the World Food Programme. (Photo taken by Patrick Paul/picture Alliance via Getty Images)

 What makes the most sense is that the cash came from a donor-advised account (DAF) which functions like a philanthropic banking account. DAFs are basically black boxes because they do not have any particular requirements, such as regular distributions, or disclosures about grants tied to a particular donor. Out of the $2.8 billion Forbes times Musk will have donated to charities over his life (without this most recent mega-gift) around 20% has come through DAFs.

 One benefit of donating stock to DAF DAF is the fact that Musk gets the tax benefits of the donation, a tax deduction as high as 30 percent of his adjusted gross income, as when he makes the gift, even though the shares are in the same way as an philanthropic storage tank.

 Another possibility could be that Musk could have put the funds into his own foundation. In that scenario Musk would still get the tax deduction immediately. However, unlike a gift directly to the DAF foundation, foundations are obliged to disperse 5percent of their assets each year. (If the foundation disperses greater than 5 percent within an entire year, the foundation may put the excess on hold for five years. If the amount is not achieved, the foundation is taxed more).

 So far, at the very least, Musk has been ranked as one of the least charitable billionaires, particularly in comparison to his wealth. There is evidence to suggest that he’s contemplating stepping up his game. In the month of February 2021 Musk announced the creation of a $100,000 “PRIZE” to be divided among teams who can develop scalable methods to eliminate carbon dioxide from the atmosphere. Musk has donated just under half of the prize through the X-Prize Foundation which oversees the prize, to date as per a representative for Musk. The foundation has already distributed 5 million of that amount to 23 teams of students to help with the beginning phases of their carbon-removal plans, However, the whole contest will not be completed until 2025.

 In the past, Musk gave $55 million to St. Jude’s Children’s Research Hospital. Musk also donated around $30 million to a range of non-profits and public schools located in the Rio Grande Valley in south Texas, which is in the region where SpaceX produces its rockets. The donation was made public at the beginning of March in 2021, amid growing critiques of local protesters who believe that SpaceX is damaging the ecosystem of the region and is displacing communities that have been there for a long time.

 In the fiscal year that ended June 2020, which is the most recent year for which the filings can be found, the Musk Foundation distributed just under $24 million of its assets totalling $941 million. About 20 million went to the form of a DAF. Other $2.9 million went to educational-related causes. It was the Mercator Center, a libertarian think tank located at George Mason University in northern Virginia which aims to promote the idea of free market, received the sum of $1 million donated by Musk. This Mercator donation was to fund “Covid-19 research and development,” according to the Musk Foundation’s tax return. The remaining $1 million was donated towards the Wikimedia Foundation, which is the non-profit that runs Wikipedia. The next biggest donation–$500,000–landed with Hack Club, a non-profit that oversees a network of nearly 500 student-led coding clubs around the world. Musk donated an additional one million dollars for Hack Club this past fall.

 He also has donated some of his time and energy to this group. When a group of teenagers discovered Musk’s contact details in public files and requested he meet with the group in March 2020. Musk was willing to participate and devoted more than an hour of live Camp;A video chat in the next month. He also donated his very first money to the group within a few days.

 Musk also gave to a few exclusive Los Angeles private schools in 2020, such as Crossroads School for Arts and Sciences located in Santa Monica and The Windward School. His foundation set aside $50,000 to fund the study of Covid-19 antibodies in Sacred Heart University, a private catholic institution located in the Connecticut suburban area of New York City. He also donated the sum of $60,000 for Ad Astra School, the experimental private school he founded in 2014 at SpaceX’s Los Angeles campus. His kids and a few students who are SpaceX staff members have attended the school. The school is now in Austin, which is where Musk spends the majority of his time. It’s also in the city where Tesla has relocated its headquarters.

 Musk hasn’t ever earned an appearance on Forbes’top rankings of philanthropists that track donations as an amount of net worth. Forbes will only include funds that have been transferred to charities’ hands (rather than money that is in one’s foundation for charitable purposes or donated funds). To date, Musk has donated just .001 percent out of the $246 billion fortune he has amassed– Forbes is not taking into account his $5.7 billion donation till we can determine if it’s actually used by the charity.

 The majority of his super-rich billionaire peers have more impressive track records. Warren Buffett, far and far the most charitable, has given away $46.1 billion during his life, or 40 percent from the $115.6 billion wealth. In 2010 Buffett as well as Bill Gates cofounded the Giving Pledge, which is a non-binding oath that has been taken to some of the world’s most wealthy individuals to contribute the majority of their fortunes in their lifetimes, or even after their death. Gates has given $33.4 billion with his ex-wife Melinda France Gates, which is around 20% of their $140.7 billion net worth. Amazon CEO Jeff Bezos, the world’s third-richest individual, has handed the sum of $2.1 billion to charities and has given around $1.3 billion for climate-related causes. That amounts to around one percent of his 188 billion dollars in wealth.

 Musk took up the pledge in 2012 The 50-year-old CEO has said he’ll ramp up his giving in the future. In 2018, Musk posted that he’d sell about $100 million worth of Tesla shares “every several years” for charity , and that he’d make “major distributions in the next 20 years, when Tesla has reached a stable condition.” The stock of Tesla has shot up 1200% since his tweet and has made Musk several hundred billions of dollars more wealthy on paper.

 When the time comes in the near future, recipient(s) from Musk’s $5.7 billion fortune could be announced. But for now it’s important to keep in mind that Musk gave away the biggest amount of money he’s ever received in the same year that was the year he sold the largest amount of Tesla shares and exercised the largest number of Tesla options. So, the motivation behind the stock donation may have much more with cutting down the tax burden rather than any other reason. If his track history is any indication that the cash isn’t reaching the most in need and will likely not be for quite a while.

  Here’s Where Elon Musk’s $5.7 Billion Gift Likely Went

 Elon Musk hasn’t been a huge charitable donor in relation to his enormous fortune, and at the time of publication it was estimated at $246 billion. But a recent Securities and Exchange Commission report released on Monday night disclosed that the CEO transferred around five millions Tesla shares during November which was worth $5.7 billion, at that time and for “charity.” In the event that this is the case, it would amount to an amount equivalent to 2.3 percent of his wealth. It’s not an overwhelming percentage, but 20 times the amount he’s before given.

 When the first filing hit the news, many speculated that Musk –the world’s wealthiest person, had given a large sum of money in support of the United Nations’ World Food Programme (WFP). The time frame is the following: A month prior to the transfer of shares to the WFP in November, Musk tweeted that he’d give six billion dollars to World Food Programme if the organization could provide “exactly the way that $6 billion will end the world’s food insecurity.” (Some speculated that Musk is a snark person, with a had a tradition of tweeting in a snark manner and snarkily, was just playing games.) However, the WFP hasn’t received an offer, as it was reported by Forbes on Tuesday. The other charities have not disclosed gifts as yet, or Musk has not responded to numerous requests for clarification.

 Elon Musk transferred $5.7 billion worth of Tesla stock to charity in November, but it’s not yet gone directly to World Food Programme. (Photo taken by Patrick Pleul/picture Alliance via Getty Images)

 What makes the most sense is the fact that the funds came from a donor-advised account (DAF) that behaves as a philanthropic account. DAFs are basically black boxes, since they do not have any particular requirements, such as the annual release of funds or public announcements of grants that are tied to a particular donor. Money can sit in DAFs for years without ever going to an operating non-profit group, which is why Forbes does not count such funds when measuring the biggest philanthropists–unless the billionaire shares details about grants actually made by their DAF, as a representative for Musk has done in the past. Out of the $2.8 billion Forbes estimates Musk will have donated to charities over his life (without the latest gift) approximately 20% of it has been given through DAFs.

 One of the benefits of donating stock to DAF can be that Musk gets the tax benefits of the donation, a tax deduction as high as 30 percent of his adjusted gross income, as shortly as he has made the gift, even though the shares are in the same way as an investment fund for philanthropy.

 Another possibility can be Musk could have channelled the funds into his own foundation. In this case, Musk would still be eligible for an immediate tax deduction. However, unlike a gift directly to the DAF foundation, foundations are required to distribute around 5% of assets every year. (If the foundation disperses greater than 5 percent within the course of a year, they are able to keep the excess over five years. If the percentage isn’t achieved, the foundation is taxed more).

 So far, at the very least, Musk has been ranked among the most uncharitable billionaires, particularly in comparison to his wealth. However, there’s evidence that he’s contemplating a move to the next level. On February 20, 2021 Musk announced the 100 million “PRIZE” to be divided between teams that could build scalable mechanisms for removing carbon dioxide from the atmosphere. Musk has donated just under half of the prize through the X-Prize Foundation which oversees the prize, to date as per a representative for Musk. The foundation has already distributed five million dollars of that amount to 23 teams led by students to aid in the initial stages of their carbon-removal initiatives however, the entire contest will not be completed until 2025.

 The previous year, Musk gave $55 million to St. Jude’s Children’s Research Hospital. Musk also gave around $30 million to a range of non-profits and public schools that are located throughout the Rio Grande Valley in south Texas, which is where SpaceX produces its rockets. The donation was made public at the beginning of March in 2021, amid increasing opposition of local protesters who believe that SpaceX is causing harm to the ecosystem in the region and displacing long-time residents.

 For the fiscal year ending June 2020, which is the most recent year for which the filings can be found, the Musk Foundation gave out just under $24 million, its assets totalling $941 million. From that, around $20 million was deposited in the form of a DAF. In the rest, $2.9 million went to causes related to education. It was the Mercator Center, a libertarian think tank located at George Mason University in northern Virginia which is geared towards advancing the idea of free market, received the sum of $1 million donated by Musk. This Mercator donation was meant to fund “Covid-19 research in science,” according to the Musk Foundation’s tax return. Another $1 million was given into the Wikimedia Foundation, the organization that runs Wikipedia. The next biggest donation–$500,000–landed with Hack Club, a non-profit that oversees a network of nearly 500 student-led coding clubs around the world. Musk donated an additional one million dollars for Hack Club this past fall.

 Musk has also donated some of his time and energy to this group. When a group of teenagers discovered Musk’s contact details in public records and requested him to talk to the group in March 2020. Musk accepted and dedicated more than an hour for a live video chat with a Camp;A following month. He then gave his initial donation to the group shortly afterward.

 Musk also gave to a select group of Los Angeles private schools in 2020, such as Crossroads School for Arts and Sciences located in Santa Monica and The Windward School. His foundation set aside $50,000 to fund the study of Covid-19 antibodies on the campus of Sacred Heart University, a private catholic institution located in the Connecticut suburban area in New York City. He also donated the sum of $60,000 for Ad Astra School, the private school that he co-founded in 2014 at SpaceX’s Los Angeles campus. His children and a few students from SpaceX staff members have attended the school. It’s now in Austin in Texas, which is where Musk is spending the majority of his time, and also the location to which Tesla has relocated its headquarters.

 Musk has not been able to earn an appearance on Forbes’top rankings of philanthropists that track donations as percent of net worth. Forbes will only include the money that been transferred to charities’ hands (rather than money that is in one’s foundation for charitable purposes or donated funds). As of now, Musk has donated just .001 percent from his wealth of $246 billion– Forbes is not taking into account on the $5.7 billion donation until we can determine if it’s actually used by the charity.

 The majority of his super-rich billionaire colleagues have better records. Warren Buffett, far and far the most generous of them all, has contributed around $46.1 billion during his lifetime, which is 40 percent from the $115.6 billion net worth. In 2010 Buffett as well as Bill Gates cofounded the Giving Pledge, a non-binding pledge taken by many of the world’s wealthiest people to contribute the bulk of their wealth during their lives or following their death. Gates has given $33.4 billion along with his ex-wife Melinda French Gates. This is about 20% of their $140.7 billion net worth. Amazon CEO Jeff Bezos, the world’s third-richest individual, has handed his $2.1 billion to charities and has given around $1.3 billion to climate-related causes. This amounts to around 1percent of his $88 billion wealth.

 Musk has signed the pledge in 2012 in 2012, and the CEO who is 50 has said he’s planning to increase his giving later in the course of his. In 2018, Musk announced that he’d be selling approximately $100 million worth of Tesla shares “every couple of years” to benefit charity, and that he’d make “major payments in 20 years, when Tesla has reached a stable condition.” Tesla’s shares have increased by 1200% since his tweet and has made Musk several hundred billions more rich on paper.

 When the time comes in the near future, recipient(s) of the $5.7 billion fortune will be announced. However, for now it’s important to keep in mind that Musk gave away the most amount he’s ever received the year in which was the year he sold the largest amount of Tesla shares and exercised the largest number of Tesla options. This means that the motive behind the stock donation may have greater to do with cutting down the tax burden rather than any other factor. If his track of his past is anything to go by, it is likely that the money isn’t reaching the most in need and will likely not be for quite a while.