SpaceX, founded by Elon Musk in 2002, is a leading force in commercial spaceflight and a major launch provider for the US government. A recent investigation reveals that the company may have avoided federal taxes on billions of dollars in revenue due to its use of tax avoidance strategies.
Internal documents show that SpaceX has accumulated nearly $5.4 billion in tax losses by 2021, allowing it to offset future taxable income and avoid millions of dollars in federal taxes. This is made possible by the US tax provision for net operating loss carryforwards, which lets companies use past losses to offset future income.
The company’s reliance on government contracts has been a key factor in its growth, with an estimated $38 billion in government funding received over the last 20 years. However, this funding comes at a cost – SpaceX’s alleged ability to shield billions in profits from the IRS presents a paradox.
While some of SpaceX’s revenue does come from foreign and state governments, it is unclear how much income tax the company has paid to these entities. The documents reviewed by The New York Times suggest that SpaceX may have avoided paying taxes to the US government, sparking concerns over the company’s role in the US space economy and national defense.
Gizmodo attempted to contact SpaceX for comment but did not receive a response.
Source: https://gizmodo.com/spacex-has-likely-skirted-federal-income-taxes-for-decades-investigation-reveals-2000643848