Key Takeaways
- The Attorney General’s office estimated Saylor avoided paying over $25 million in taxes.
- The lawsuit claimed Saylor listed himself as living in Florida or Virginia, which have lower tax rates while residing in Washington
In a settlement hailed as the “biggest-ever income tax fraud recovery” for the District of Columbia, tech entrepreneur Michael Saylor and the company he founded, MicroStrategy agreed to pay $40 million to resolve accusations of dodging taxes for over a decade.
The District sued Saylor and his company, MicroStrategy, in August 2022, alleging he misrepresented his residency to avoid paying D.C. income taxes. Prosecutors claimed Saylor listed himself as living in Florida or Virginia, which have lower tax rates, while actually residing in the nation’s capital.
The lawsuit claims that Saylor’s real home was a luxury penthouse apartment in Washington overlooking the Georgetown waterfront, where he kept his yachts on the Potomac River. The attorney general had charged both Saylor and MicroStrategy with tax evasion, alleging that the company aided its founder in disguising his D.C. residency so he could avoid paying higher income taxes.
The Attorney General’s office estimated Saylor avoided paying over $25 million in taxes. Experts initially predicted he could face penalties as high as $75 million. Reportedly, MicroStrategy allegedly failed to pay the corporate taxes required for a company employing D.C. residents, of which Saylor was allegedly one of several.
Following the lawsuit, Saylor stepped down as CEO of MicroStrategy in August 2022, a position he held since founding the company 33 years prior. He transitioned to the role of Executive Chairman and remains Chairman of the Board.
Saylor has however rubbished the allegations and has held on to his claim that he lives in Florida. Despite his resignation as CEO, Saylor has continued to champion Bitcoin adoption for MicroStrategy. The company’s most recent major purchase came in March 2024, acquiring 12,000 Bitcoins through an $800 million convertible note offering.
As of May 1, 2024, MicroStrategy holds 214,400 Bitcoins, purchased at an average price of $35,000 per coin, for a total investment of roughly $7.5 billion.
