[Schweigi]

He doesn’t need to shiphon anything. All the “donated” money is still in his control. In order to be effective at tax deference you need to separate the concept of who ownes the money and who controls it. As long as you still control it, it doesn’t matter who ownes it. That’s why a donner advised funds and similar concepts are used to reduce taxes or defer them.

In addition it’s also great for asset protection. For example if he gave a personal guarantee on some of the Twitter debt, then moving money into the foundation (as long as his Twitter stint was not fraud) will remove that out of his name and make it untouchable to the banks.

He can now use those funds to support trips to Mars and other projects. For those projects the charity might pay his expenses - for example a flight to attend a meeting in Hawaii. He can even use the money to hire his kids. The kids would have a much lower (w2) tax rate so effectively he reduced tax but kept the money in the family.

[mindslight]

Exactly. It's not some hack that magically makes income tax liability just disappear, as many commenters are thinking it could be. Rather there are marginal tax benefits combined with strong asset protection, that make sense when you've got an obscene amount of money to manage so the administrative overhead becomes negligible - the question goes from "why" to "why not".

Another thing people are missing is that it's not an income tax dodge, but rather an estate tax dodge. The money will remain in control of his heirs, assuring they'll never go hungry or want for a place in the world.

It also creates more opportunities to play with asset valuations to evade taxes (eg separate the financial and voting interest of some stock in a closely held company, then claim the financial interest is worth very little without the control interest). But it's impossible to know if this is actually being done without seeing tax filings, including his (eventual) estate tax filing.