OpenAI CEO Sam Altman Faces IRS Complaint Over Potential Windfall Violating US Tax Laws

OpenAI's CEO Sam Altman is facing a complaint from a tech watchdog group, the Midas Project, to the Internal Revenue Service. The complaint alleges that Altman's status as both CEO of OpenAI's for-profit operations and seat on its nonprofit board creates a conflict of interest, allowing him to personally benefit from nonprofit decisions. Altman is expected to receive an equity stake in a restructured OpenAI entity worth billions of dollars. The complaint also notes that Altman's personal investments are entangled with OpenAI, creating a situation where his financial interests are advanced through nonprofit decisions.

OpenAI, the prominent artificial intelligence company, is under scrutiny following a complaint filed by the Midas Project with the Internal Revenue Service (IRS). The complaint alleges that OpenAI's CEO, Sam Altman, is violating US tax laws by holding a dual role as both CEO of the company's for-profit operations and a seat on its nonprofit board, creating a significant conflict of interest.

According to the complaint, Altman's dual role allows him to personally benefit from nonprofit decisions, including receiving an equity stake in a restructured OpenAI entity worth billions of dollars. The complaint also notes that Altman's personal investments are entangled with OpenAI, potentially advancing his financial interests through nonprofit decisions [1].

The complaint highlights several conflicts of interest, including those involving OpenAI board members Bret Taylor and Adam D'Angelo. Taylor co-founded Sierra AI, which resells OpenAI's models to enterprise customers, while D'Angelo is CEO of Quora, an OpenAI customer. Additionally, board member Adebayo Ogunlesi's firm, Global Infrastructure Partners, owns data centers that stand to profit significantly from AI infrastructure demand driven by OpenAI's scaling [2].

The Midas Project, which aims to ensure that leading AI firms like OpenAI are following the law and acting in the public interest, argues that the restructuring will weaken the nonprofit board's ability to steer the for-profit arm. The complaint also suggests that OpenAI may have improperly doled out nonprofit grants to subsidize customers of its for-profit operations, such as the $50 million NextGenAI Program [3].

The IRS scrutiny of OpenAI could further complicate Altman's ongoing restructuring plans, which are already being looked at by regulators in California and Delaware. Altman faces an ongoing federal lawsuit filed by his longtime rival Elon Musk, who co-founded OpenAI and has accused the firm of abandoning its original mission while pursuing profit [4].

In response to the complaint, an OpenAI spokesperson noted that Altman has no direct equity stake. The company declined further comment. However, Altman has previously stated that no final decisions have been made regarding his potential equity stake in the restructuring [1].

The complaint comes at a politically fraught time for Altman, who has shown signs of cozying up to President Trump after years of donating to Democratic causes. Altman appeared at the White House in January to promote the Stargate AI project, a $500 billion federal initiative focused on artificial intelligence and national infrastructure [2].

References:
[1] https://www.newsbytesapp.com/news/business/watchdog-accuses-openai-of-violating-us-tax-laws/tldr
[2] https://www.marketscreener.com/quote/stock/MICROSOFT-CORPORATION-4835/news/OpenAI-s-Sam-Altman-Talks-Talent-War-Trump-and-Musk-50462930/
[3] https://nypost.com/2025/07/10/business/watchdog-slams-openai-with-irs-complaint-warning-ceo-sam-altman-is-poised-for-windfall-in-violation-of-us-tax-law/
[4] https://www.livemint.com/news/us-news/openai-ceo-sam-altman-mocks-musk-over-trump-split-elon-busts-up-with-everybody-that-s-what-he-does-11752092595058.html