Roblox CEO Discovered to Be Abusing Tax Exemption

But It’s Still Perfectly Legal

Roblox hasn’t made the best choices as of late. Despite being the top grosser in the North American video gaming industry, there have been some concerns about the company not being safe for minors. But we haven’t heard many problems with the Roblox company itself.


But apparently, the founder and CEO of Roblox Corporation has been taking advantage of a certain tax loophole for years. David Baszucki, according to financial reports and New York Times resources, has been using what is known as the Qualified Small Business Stock exemption (or the QSBS exemption) for years.

The exemption is supposed to help start-up companies gather investors. What it is supposed to do is shield starter companies and from having to pay taxes for profits up to ten million dollars- that is, if the company had assets that were at or below 50 million dollars.

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And Baszucki has had a field day with this loophole- and the loophole of a loophole.

This loophole within the QSBS exemption, where if you gift stocks to friends and or family, taxes don’t have to pay for the stocks, even if they meet the requirement. Baszucki, even before Roblox went public, has been gifting stock to his wife and four children. His mother in law in the fall of 2020, before the Roblox stocks went public, even gifted stocks to various relatives.

This is a perfectly legal practice, however.  It even has two known terms for the practice, either stacking or peanut buttering. But this is a practice that wealthy families can, and do, use in order to get away with not paying American taxes.

While the current Administration wants (or at least suggested) to cut the exemption in half, that just means a lot more future peanut buttering. Which also means…

Roblox, whether through assets, outright profits,  or through the stock market, will be supporting the Baszucki family, tax-free, for many years to come.