Jeff Bezos Plans to Save $600 Million in Taxes Through Amazon Shares Sale

Amazon’s founder and chairman, Jeff Bezos, has recently sold shares of the tech giant, netting him 4.1 billion dollars in just a few days. This information was revealed in two reports submitted to the US Securities and Exchange Commission (SEC). These sales were spread across four trading days on Wall Street, with shares being sold at prices between $169.7-174.8 each. The sales were part of a blind sale plan Bezos implemented last year, which ensures the shares are sold at predetermined times and volumes, independent of the current market price.

Nir Orgad, a foreign stock analyst at Bank Leumi’s consulting department, has noted that Bezos has sold shares in the past following a rise in share price. He mentions that Amazon announced in early February that Bezos planned to sell 50 million shares by the year’s end, currently valued at around $8.5 billion. To put this into perspective, Bezos owns shares with a total value of about 170 billion dollars, which means that if he reaches his goal he will sell about 5% of his holding.

Over the past year, Amazon’s stock has seen a nearly 70% increase, reaching record levels in 2021. Orgad suggests that the recent surge in the stock price is a good reason to sell. He points out other founders and CEOs, such as Marc Benioff from Salesforce and Mark Zuckerberg from Meta, who have also sold shares following a surge in stock prices. Bezos has not disclosed his reasons for selling his shares, but potential reasons could include philanthropic endeavours or the desire to invest in other ventures.

News recently broke that Bezos intends to move from Seattle, Washington, to Miami, Florida, after living in Seattle for 30 years. CNBC linked this move to his share sales, pointing out that Washington imposes a new 7% capital gains tax on the sale of securities over $250,000, while Florida does not have such a tax. As a result, Bezos saved more than 280 million dollars in tax from the sale of the 4.1 billion dollars worth of shares. The total sale planned for the coming year, including all the shares he plans to sell while living in Florida, will save him an estimated 610 million dollars in tax.

As of the end of 2023, Bezos owned 11.5% of Amazon’s share capital, making him the largest shareholder. Following the recent sales, his holdings are expected to drop to about 9.5%. Bezos has not sold any Amazon shares in the past two years, but his holdings have still decreased due to his donations of multiple shares to non-profit organizations.