According to CNBC, unnamed sources have told the publication Tesla CEO Elon Musk plans to relocate from California to Texas.
Back in May, Musk said he was selling his home and possessions. The decision is likely tied to saving taxes, since Texas has no state income tax, but California has the highest state income tax rate of 13.3%.
I am selling almost all physical possessions. Will own no house.
— Elon Musk (@elonmusk) May 1, 2020
“Several of his close friends and associates say that Musk has told them he’s planning to move to the Lone Star State. The people with knowledge of his plans asked not to be named because their conversations were private,” reported CNBC.
SpaceX, Tesla and the Boring Company all have offices in Texas, which is home to a new gigafactory under construction in Austin.
With Musk’s net worth at $139 billion, making him the second richest person in the world (Amazon’s Jeff Bezos is first), the move to Texas could save billions. Musk’s net worth is mostly in shares of Tesla, which has soared over 1,000% since July of 2019.
Fortune explains, “as Musk begins to tap into that paper wealth, he’ll be required to pay California’s top capital gains tax rate of 13.3%—in addition to the top federal capital gains rate of 20%.”
Rough calculations at Tesla’s current share price of $599.04 mean Musk could save up to $18 billion in capital gains taxes, if he moved to Texas.
Jiminy. I think we’d move too.
