Today, Explained

Is Patagonia fleecing the IRS?

8 snips
Sep 20, 2022
Daniel Hemel, a tax expert from NYU, and David Gellis, a climate change journalist from The New York Times, delve into the surprising tax implications of Patagonia's unique philanthropic model. They discuss how the company's billionaire founder is leveraging tax strategies while fighting climate change. The conversation touches on Patagonia's commitment to sustainability, the challenges of generational leadership, and the delicate balance between philanthropy and profitability. Listeners gain insight into the complexities of eco-conscious business practices and tax policies.
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ANECDOTE

Patagonia's Origins

  • Yvon Chouinard, Patagonia's founder, started by making climbing gear.
  • His focus on minimizing environmental impact has guided Patagonia's business practices.
INSIGHT

Patagonia's Giveaway

  • The Chouinard family gave away 98% of Patagonia's shares to a non-profit, Holdfast Collective.
  • A trust, holding 2%, maintains company control, directing profits towards environmental causes.
INSIGHT

Philanthropy or Tax Avoidance?

  • This donation raises questions about philanthropy versus tax avoidance.
  • Giving away the company in other ways would have incurred significantly higher taxes.
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