Mark Zuckerberg is defending the decision to set up a vehicle for his philanthropic ventures as a limited liability company (LLC) instead of a charity.
Earlier this week, the Facebook CEO and his wife Priscilla Chan announced that they would give away 99 percent of their Facebook shares to philanthropic efforts coordinated through a new entity dubbed the Chan Zuckerberg Initiative.
Zuckerberg said Thursday that the LLC structure was being used to give them the flexibility to pursue their favorite causes through a variety of means, such as investments and advocacy, that are different from traditional charitable donations.
“Any net profits from investments will also be used to advance this mission,” he said in a post to his Facebook page, and he pushed back against the idea that the structure would provide the couple with tax benefits.
“By using an LLC instead of a traditional foundation, we receive no tax benefit from transferring our shares to the Chan Zuckerberg Initiative, but we gain flexibility to execute our mission more effectively,” he said. “In fact, if we transferred our shares to a traditional foundation, then we would have received an immediate tax benefit, but by using an LLC we do not.”
The couple will pay capital gains taxes if the initiative sells their donated shares, he said.
He also responded to some of his critics in the comments section of the post, at times beseeching them not to “spread false information.”
When a user wondered aloud whether it was really Zuckerberg responding, or a member of Facebook’s communications staff, he said his newborn daughter was “taking a nap so I'm replying to comments on the internet!”