Fact Check Team: Jeff Bezos's Florida move could save him $600M in taxes

WASHINGTON (TND) — Amazon founder Jeff Bezos has made headlines with his decision to move to Miami, Florida, after nearly three decades in Seattle. The move is projected to save him approximately $600 million in taxes.

Bezos's decision to relocate is attributed to his desire to be closer to family and his Blue Origin rocket launches. Florida's tax laws are also a perk of the move, particularly its absence of both state income tax and capital gains tax. In 2022, Washington introduced a new 7% capital gains tax on sales of stock or bonds exceeding $250,000. After the tax was imposed, Bezos halted stock sales in 2022 and 2023 and only gifted $200 million of shares at the end of last year. However, he has now initiated a pre-scheduled plan to sell 50 million shares before January 31st, amounting to over $8.7 billion.

Florida's tax laws will contribute significantly to Bezos's tax savings. With no state income tax or capital gains tax in Florida, Bezos stands to save at least $610 million from the sale of the 50 million shares, assuming Amazon shares maintain their current value. Moreover, if the value of Amazon shares continues to rise, Bezos could potentially save even more.

In addition to Florida, a handful of other states do not have a capital gains tax including Alaska, New Hampshire, Nevada, South Dakota, Tennessee, Texas, and Wyoming. Notably, these states also do not impose personal income taxes. Washington state does not have a personal income tax and the decision to impose a capital gains tax has been contentious. The new tax has been met with legal challenges, including a case that reached the state's Supreme Court and an initiative aimed at repealing the tax is on track to be on the state's ballot this year.

Capital gains taxes can generate significant revenue for states. According to the Washington State Standard, the state collected $890 million off the tax in 2023, the first year it was collected. However, these taxes are not the most stable form of revenue because they are heavily reliant on financial market performance and can fluctuate from year to year. Furthermore, there are fears that such taxes could drive individuals and businesses to relocate to states with more favorable tax climates, potentially impacting state revenues.