Thread

1. djoldman · 1790864377 · focus · HN ↗

   It often strikes me as quite the biased and one-sided take when a tax-paying entity is called out by the press for tax avoidance (NOT tax evasion, which is illegal). (yes TFA implies that Meta is breaking the law, I'm not talking about situations where entities break the law).

   Previously we've seen "The Secret IRS Files" from Propublica as well as other coverage of tax avoidance that never resulted in tax evasion charges. Coverage wide enough that it's arguably safe to assume that no laws were broken because there was quite the demand for an enforcement response.

   The funny thing is that a more accurate title for these pieces would be, "Federal Government Allows [tax-paying entity] a Massive Tax Break." And then the piece would be all about how the senate, congress, and president either explicitly wanted there to be this extreme tax loophole or was incompetent and allowed something they didn't mean to allow.

   Folks are continually getting upset and riled up about players in the economic system instead of who and what makes the rules.

   An analogous example: everyone got cranky about Martin Shkreli, mostly because he raised prices on Deraprim, although also because many would label him a brash jerk. But he went to jail for finance stuff, not raising prices. Why? Because raising prices in the way he did wasn't something the feds thought was illegal or wasn't something they thought he could be convicted of.

   Folks get mad at Musk, Zuckerberg, etc... if they're doing something illegal, ok yea that makes sense. If folks are mad about actions that are legal, it makes zero sense to be mad at the actor. Be mad at the people/entities who created the legal loopholes and laws.

   1. bluegatty · 1790864572 · focus · HN ↗

      Yes, we can expect companies to lower their tax bill.

      This is not about Zuck it's about the IRS and probable political interference.

      1. boringg · 1790865496 · focus · HN ↗

         The framing is around Meta avoiding paying taxes not about IRS and political interference. Its written in a way to cast shame as an implied bad actor.

         1. bluegatty · 1790865811 · focus · HN ↗

            Yes, that's what I mean. That said - Meta is likely knowingly breaking rules, which is unethical, they deserve blame as well, but the framing should be more holistic.

            1. boringg · 1790866027 · focus · HN ↗

               They aren't breaking the rules which is the point.

               1. bluegatty · 1790866364 · focus · HN ↗

                  No, they are probably breaking the rules - and the rules are not being enforced. That's the point.

                  If this were merely a company using a regular tax deduction there would not be much of a story.

                  The story is that these GPUs are not being used for research but Ops and therefore should be subject to taxation.

                  1. yieldcrv · 1790867721 · focus · HN ↗

                     I disagree, this is an article about Meta’s finance department being full of risk averse accountants and that being used as validation, when they shouldn't be

                     The IRS does enforce this credit

                     Moving beyond that, its super easy to rationalize how these are used for experiments

                     People post framework after framework every day here that eeks more performance out of the same inference hardware

                     That will satisfy the experiments over operations need easily

                     The IRS isn’t the authority when they disagree, the courts are. And in court you can tell the IRS to pound sand and tell reporters to take it up with Congress

                     1. bluegatty · 1790868866 · focus · HN ↗

                        ??

                        -- Meta's accounts are not 'risk averse' - if they were, they wouldn't be claiming the credit.

                        -- ""People post framework after framework every day here that eeks more performance out of the same inference hardware

                        That will satisfy the experiments over operations need easily""

                        No, not even remotely.

                        The easiest way to measure would be 'training vs inference' - and almost all training is R&D and almost all inference is Ops.

                        If we had to do something crudely.

                        The implication that 'the product itself is a market experiment' is absurd.

                        That's not the kind of R&D that gets tax credits.

                        This is a very simple story: Corporate entities stretching the tax code in ways it was not intended, until the authorities tell them not to. The authorities are manipulated by politics.

                        1. yieldcrv · 1790869721 · focus · HN ↗

                           > The move caused some unease within Meta’s finance department

                           okay

                        2. bluegatty · 1790870371 · focus · HN ↗

                           Yes, the move causes 'concern' with the 'finance department' because it's probably illegal.

                           Surely they are themselves as individuals risk averse, they usually all are, I mean to imply this action is not one of 'risk aversion' obviously, it's the opposite.

                           Surely Zuck is the one pushing his CFO to do this.

                           1. yieldcrv · 1790874473 · focus · HN ↗

                              yeah, and accountants incur some liability by signing off on tax filings

                              it moves liability off of the tax filer onto them and one can also add another layer with the tax lawyer

                              but the liability does exist, so they have to weigh their compensation with the weight of the government

               2. justincormack · 1790866435 · focus · HN ↗

                  Its not clear, the IRS will presumably decide if, for example, Zuck gets an R&D tax deduction from his salary because he contributes to code, which no other large tech company has tried to claim.

Unofficial Hacker News client; not affiliated with Y Combinator.