Steve Ballmer: Reaping a Billion Dollars Annually, Effortlessly
Steve Ballmer, former Microsoft CEO, effortlessly earns an astonishing $1 billion annually as passive income Unlike most people's pocket change, this massive sum effortlessly supplements his main source of income
Most people consider passive income as a small amount of extra money that requires little effort to earn, supplementing their main income. For Steve Ballmer, it's a staggering $1 billion. As the sixth richest person in the world, Ballmer is set to receive this amount in dividends from Microsoft by 2024. This follows the tech company's decision to increase its quarterly dividend payout to 75 cents per share, or $3 per share annually.
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As of 2014, former Microsoft CEO Ballmer owned 333.2 million shares of the company, representing a 4% stake. If he continues to own this amount, he could receive nearly $1 billion in fiscal year 2024, regardless of the stock's performance. Ballmer did not comment on this information.
Assuming Microsoft's board of directors doesn't cut dividends, which seems unlikely considering the continuous increase in dividend payouts since 2003. Ballmer won't be the only one benefitting - Uncle Sam will also be receiving a significant portion.
Ballmer reported $656 million in income to the Internal Revenue Service in 2018, according to ProPublica. This means he will likely be subject to the 20% tax on dividends for individuals earning a taxable income of $500,000 a year or more, resulting in approximately $200 million in taxes on the Microsoft dividends he receives.
Ballmer is not the only individual poised to earn substantial income from owning dividend-paying stocks.
Berkshire Hathaway, led by Warren Buffet, is projected to receive $6 billion in dividends this year, as revealed by a Wall Street Journal report. This substantial dividend income is largely attributed to the investments in various dividend-paying stocks such as Chevron, Bank of America, Apple, Coca-Cola, Kraft Heinz, and American Express.
