Patagonia's founder Yvon Chouinard creates a 501(c)4 to give away his money : The Indicator from Planet Money Surf's up with the IRS! Patagonia's founder Yvon Chouinard recently gave his company and billionaire status away. But how he did so entails a complex tale of trusts, exemptions and a whole lot of taxes.

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Patagonia's tax break, explained

Patagonia's tax break, explained

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Michael M. Santiago/Getty Images
A Patagonia store signage
Michael M. Santiago/Getty Images

Last week, Patagonia's founder Yvon Chouinard rejected his billionaire status by giving up his company. But how he did that involves a complex entanglement of tax exemptions and designations.

At the heart of the story is the infamous 501(c)4. This type of nonprofit – a social welfare organization – gained notoriety in the past for being a conduit for dark money in politics. But that's not always what the designation is used for. Today on the show, we're dissecting the (tax) code on the company (and the man) with a mission to save Planet Earth.

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For sponsor-free episodes of The Indicator from Planet Money, subscribe to Planet Money+ via Apple Podcasts or at plus.npr.org.