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Tesla sued by Nevada for failure to pay $650,000 in taxes

Tesla sued by Nevada for failure to pay $650,000 in taxes


More financial problems for Elon Musk’s company

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Illustration by Alex Castro / The Verge

Tesla was sued by the state of Nevada earlier this week for its failure to pay nearly $655,000 to the state’s Unemployment Compensation Fund, according to Bloomberg.

According to the liability statement, Tesla is indebted to the Employment Security Division of the state of Nevada. The carmaker didn’t pay enough for the first and second quarters of 2018 when Tesla had $68 million and $55 million in taxable wages, respectively.

Tesla’s giant Gigafactory is located outside of Reno, where it makes battery packs and other parts for its Model 3 electric vehicle. In a statement, a spokesperson for Tesla chalked up the unpaid taxes to a “clerical error.”

“Since Tesla acquired SolarCity and incorporated all of its employees, we’ve been in discussions with states over new unemployment insurance contribution rates, which is typical in acquisitions like this,” the spokesperson said. “This judgment is the result of a clerical error, and we have processed this payment today to reflect the latest unemployment insurance contribution rates. Over the past 18 months, Tesla has already paid over $3.3 million in unemployment taxes to Nevada.”

Tesla is under enormous pressure to turn a profit, something the carmaker has only done once for a single three-month period. The company burned through more than $1 billion in the first quarter of 2018, ending with less than $2.7 billion in the bank. Tesla is expected to report its third quarter numbers at the beginning of November.