Jeff Bezos, the billionaire founder of Amazon, recently relocated to Miami, and this move is expected to result in significant tax savings for him. Last year, Bezos announced his decision to leave Seattle after almost 30 years and move to Miami, citing reasons such as being closer to his parents and his rocket launches at Blue Origin. However, it is widely believed that taxes played a crucial role in his decision.
In 2022, Washington state imposed a new capital gains tax of 7% on stock or bond sales exceeding $250,000. Since Washington does not have a personal income tax, this was the first time Bezos would have faced state taxes on his stock sales. As a result, Bezos ceased selling his Amazon shares in 2022 and 2023, instead opting to gift $200 million worth of shares at the end of last year.
However, with his relocation to Miami, Bezos wasted no time in making up for the lost time. A recent filing with the Securities and Exchange Commission (SEC) revealed that Bezos launched a pre-scheduled stock-selling plan to sell 50 million shares before January 31, 2025. At the current price, this amounts to over $8.7 billion.
The key advantage for Bezos in this move is that Florida does not have a state income tax or a tax on capital gains. Consequently, on the recent $2 billion stock sale, Bezos saved $140 million that he would have had to pay in taxes if he had remained in Washington state. Over the next year, as he sells the remaining 50 million shares, he stands to save at least $610 million in taxes. This estimate assumes that the value of Amazon shares remains constant. If they continue to rise, his tax savings will be even higher.
To put it into perspective, the money saved from taxes alone is more than enough to cover the cost of Bezos’ 417-foot yacht, Koru. Additionally, Bezos has purchased two mansions in Indian Creek for $147 million and is reportedly considering acquiring three more properties on the island. He is expected to demolish the existing homes and build a new estate, with the total cost likely exceeding $200 million.
Miami’s appeal as a tax haven for billionaires has been growing in recent years. The city is already home to high-profile residents like Tom Brady and Carl Icahn. The absence of state income tax and capital gains tax makes it an attractive destination for wealthy individuals looking to minimize their tax liabilities.
In conclusion, Jeff Bezos’ relocation to Miami is expected to result in significant tax savings for the billionaire. By moving to a state with no income tax or capital gains tax, Bezos stands to save hundreds of millions of dollars on his stock sales. This move further highlights Miami’s growing stature as a tax haven for the super-rich.
