Authored by Zachary Stieber via The Epoch Times,
A possible new wealth tax in California prompted Meta chief Mark Zuckerberg to consider leaving the state, according to a new regulatory filing.
California voters will decide on Proposition 40 in November. It would impose a one-time 5 percent tax on billionaires.
If approved, Zuckerberg would have to pay a multibillion-dollar tax, Meta lawyers said in the Oct. 21 filing to the Securities and Exchange Commission that included frequent mentions of a special committee of independent directors.
"In light of this potential tax exposure, Mr. Zuckerberg informed the Special Committee that he was evaluating relocating his primary residence outside California and that steps toward any such relocation, including any listing of his residential real estate in California on the market, would be public and inevitably noted and commented upon by Company employees and, accordingly, raise questions for management of the Company going forward," the filing stated.
The committee said Zuckerberg "has been crucial to the Company's growth since its inception," that he is best-positioned at this time to ensure the company's continued success, and that it is important to keep him in a leadership position to drive the company's continued success.
Meta, Facebook and Instagram's parent company, faced challenges during the COVID-19 pandemic, which it said stemmed from Zuckerberg's inability to be physically present with the company's management team, and the committee did not want similar challenges in the future.
The company said it is creating a new class of stock, beginning in January 2027, that will let it raise money for investment in artificial intelligence systems and incentivize Zuckerberg to remain a Meta executive.
An upcoming stock dividend will distribute class C shares to Zuckerberg and other shareholders.
"Again, the goal is to keep Mr. Zuckerberg continuing to lead the Company from California and in close proximity to Meta Superintelligence Labs," the filing stated.
"In light of that importance, the Special Committee secured Mr. Zuckerberg's commitment to remain a resident of California, or any other jurisdiction in which the Company maintains its corporate headquarters, for eight years from the date of the Founder Alignment Agreement, for so long as Mr. Zuckerberg satisfies the Continued Leadership Condition, unless there are material unforeseen circumstances that would render it prudent or advisable for Mr. Zuckerberg to reside elsewhere."
Meta on Wednesday reported a third-quarter profit of $9.89 billion, up from $2.79 billion in the third quarter of 2025. Earnings per share were $3.83, up from $1.05.
The jump stemmed in part from much lower taxes and higher revenue.
Meta's revenue was $64.6 billion in the third quarter, and it expects to make $73 billion to $76 billion in the fourth quarter.
"We hit major milestones this quarter toward delivering personal superintelligence for everyone - including launching Muse and Muse Wonder, our first frontier model," Zuckerberg said in a statement. "Our investments are paying off, the core business is strong, and we're seeing velocity across the board."