Google founders to leave California amid tax concerns

Sergey Brin and Larry Page seem to be quietly dismantling sections of the empire they spent 20 years building, a dynamic that reflects how the tax politics of their home state are driving decisions about where the elite class can afford to live — or not.

Dozens of limited liability companies associated with the Google co-founders have been dissolved, converted into Nevada entities or shifted to other entities outside of California, according to reporting by The New York Times. A trust connected to Page also purchased a $71.9 million house in Miami, hinting at possible domicile planning in a state without personal income tax. Both of its founders still own homes in California, but the legal and real estate maneuvers seem to indicate a reconfiguring.

What changed in the founders’ footprints and legal entities

At least 15 LLCs linked to Brin were dissolved or transferred to Nevada, among them entities that manage a superyacht and an interest in a private terminal at San Jose International Airport, The Times reports. For Page, about 45 LLCs recently went inactive or moved out of state. These are not minor adjustments; LLC realignments mean filings, counsel and careful timing — especially when residency and tax exposure are in play.

Nevada is a popular venue for holding companies based on its business-friendly laws and lack of a state income tax. Florida, meanwhile, has no state income tax and generous homestead protections, so it’s a top destination for high-net-worth people changing domiciles.

The tax backdrop shaping decisions on residency moves

Already, California’s top marginal state income tax rate is the highest in the nation at 13.3%. And a ballot measure under consideration would add a one-time 5% tax to the liabilities of anyone with a net worth above $1 billion. Crucially, supporters also want the levy to be retroactive for anyone deemed a resident of California at the beginning of this year — where timing and paper trails validate it.

Wealth taxes are notoriously difficult to administer and litigate, but the headline figure also can move behavior. For those founders whose wealth is tied up in the illiquid stock they own, a one-time hit to their net worth — even if it can be paid over time — can translate into significant cash calls or asset sales.

Your Residency Is More Than Just a Mailing Address

California residency tests look to “domicile” and facts and circumstances, not simply the number of days a person resides in one place. Where a person’s base of their connections is located — home, family, business interests, advisers, charitable boards and major assets — can outweigh a straightforward day count. That is why even high-profile movers tend to partake of the softer forms of change: Re-domiciling trusts, re-papering LLCs, moving board meetings and recording real-world routines as being set in the soil of a chosen new home state.

Moving your CA LLCs to NV or dissolving them does not assure a residency change alone. But combined with Florida real estate purchases and a larger relocation of business administration, it establishes turf that tax authorities and courts tend to scrutinize when disputes arise.

Signals from a wider migration pattern among elites

Migration data from the I.R.S. indicate that California has seen the biggest net outflow of adjusted gross income to other states in recent years, particularly to Texas and Florida. Analysts with the Public Policy Institute of California point out that housing costs and remote work are key factors motivating many moves, though outflows come disproportionately from higher-income households — a pattern similar to what we see among tech’s own upper echelons.

When icons like Page and Brin ponder changing domicile, the symbolism counts. It can push policymakers to confront trade-offs between revenue aspirations and the danger of undercutting the tax base, especially in years of budget strain. It also signals to other founders and investors that the move isn’t just something on paper — it’s operationally possible with proper planning.

What It Means for Google and Silicon Valley

Alphabet, whose headquarters, employees and core operations are still based in the Bay Area, is not going to simply up and leave because its co-founders feel like moving personal residences. Brin and Page have already stepped back from day-to-day management years ago, but they still have vast control over the company through super-voting shares and remain influential on strategic issues, including artificial intelligence.

Still, the investment vehicles, philanthropic entities and family office functions of the founders tend to go where they do. It can change where capital is deployed, where startups pick up their early checks and where research collaborations take hold. Miami, Austin and Las Vegas have all wooed that ecosystem with easier permitting, tax incentives and growing tech networks.

The next questions on taxes, domicile and policy timing

The first watch items are simple: whether the proposed billionaire tax measure gets on the ballot, what any legal challenges mean in terms of its scope and retroactivity, and how the personal and corporate entities started by the co-founders continue to move out of California. For now at least the paper trail imparts a clear story — one that jibes with how ultra-wealthy people reposition themselves methodically when policy breezes change.

California has always exchanged higher taxes for a deep bench of talent, capital and culture. If two of the state’s most high-profile entrepreneurs are getting ready to declare another state their home, Sacramento may soon be forced to rethink where that balance should fall.