Meta CEO Mark Zuckerberg has committed to remaining a California resident for the next eight years after the company's board approved a plan to change its stock structure. According to regulatory filings released Wednesday, Oct. 21, 2026, Zuckerberg had informed a special committee that he was considering relocating his primary residence outside the state due to a proposed billionaire wealth tax. The company stated that Zuckerberg's presence at its headquarters is critical to managing investments in artificial intelligence and navigating competition.
The agreement involves the creation of a new class of nonvoting Class C common stock. This structure allows Zuckerberg to sell a portion of his holdings to cover potential tax liabilities without reducing his 61% voting control of the company. Meta reported that without this change, Zuckerberg might have been forced to sell voting shares, which would have reduced his control of the technology group. The filing noted that any steps toward relocation, such as listing his California real estate, would have been public and could have raised concerns among employees.
The proposed tax, known as Proposition 40, will appear on the Nov. 3 ballot. It seeks a one-time 5% levy on the assets of California billionaires. For Zuckerberg, whose net worth is estimated at $247 billion by the Bloomberg Billionaires Index, this could result in a tax bill of approximately $12.4 billion. While Zuckerberg reached this residency agreement with Meta, other tech leaders including Tony Xu, Chris Larsen, and Ron Conway have funded efforts to oppose the measure. California Gov. Gavin Newsom has also expressed opposition, stating that state-level wealth taxes could drive away wealthy residents.
The outcome of Proposition 40 affects California’s wealthiest residents and the state's public funding for healthcare, food assistance, and education. Proponents designed the measure to raise an estimated $100 billion for the state's healthcare system by taxing billionaires at a 5% rate on their accumulated wealth.
Stanford University economists reported that the departure of billionaires could lead to lower-than-projected wealth tax revenue and a decrease in overall state income tax collections. Newsom and some tech executives have argued that such a policy could encourage wealth migration to other states. Supporters of the tax argue the revenue is necessary to fund services for Californians who rely on state-supported health and nutrition programs.
If California residents approve Proposition 40, the tax would be implemented as a one-time levy. Meta's new Class C stock structure is set to take effect in January, providing Zuckerberg the mechanism to sell shares for the tax payment while maintaining his control. Meanwhile, Meta is also managing a $25 billion penalty ordered by a New Mexico judge regarding consumer protection law violations linked to the Cambridge Analytica scandal, a ruling the company has stated it intends to appeal.