This morning former Massachusetts Governor Mitt Romney’s presidential campaign released Romney’s 2010 tax return and some details on the “unemployed” candidate’s 2011 income. Some links and analysis are after the jump.
The Washington Post got a preview of Romney’s tax documents, which show $21.7 million in 2010 income and $20.9 million in 2011 income, none from wages.
The couple gave away $7 million in charitable contributions over the past two years, including at least $4.1 million to the Church of Jesus Christ of Latter-day Saints. Romney’s family has for generations been among the Mormon Church’s most prominent members.
The Romneys sent somewhat less to Washington over that period, paying an estimated $6.2 million in federal income taxes. According to his 2010 return, Romney paid about $3 million to the IRS, for an effective tax rate of 13.9 percent.
For 2011, Romney estimates that he will pay about $3.2 million, for an effective rate of 15.4 percent. That’s in line with his earlier estimates, but sharply lower than the rates paid by President Obama and Romney’s closest Republican rival, Newt Gingrich.
The Washington Post put together this graphic showing basic information from the Obama, Gingrich, and Romney tax returns.
No wonder Romney suggested recently that he didn’t make a significant amount in speaker fees. That figure ($374,000) may be enough to put him in the top 1 percent of Americans by income, but it’s a tiny number compared to his investment income.
Yesterday billionaire investor Warren Buffett discussed what’s sure to be a recurring theme of the general election campaign:
“It’s the wrong policy to have,” Buffett told Bloomberg Television’s Betty Liu in an interview today. “He’s not going to pay more than the law requires, and I don’t fault him for that in the least. But I do fault a law that allows him and me earning enormous sums to pay overall federal taxes at a rate that’s about half what the average person in my office pays.” […]
“He makes his money the same way I make my money,” Buffett said. “He makes money by moving around big bucks, not by straining his back or going to work and cleaning toilets or whatever it may be. He makes it shoving around money.”
Ron Fournier argues that Romney won’t be able to avoid disclosing a full decade of tax records if he becomes the nominee:
Rather than put this sideshow to rest, the younger Romney has given his political enemies fodder to undercut the centerpiece of his campaign — his status as a turn-around artist at Bain.
“Governor, how about your father’s model of 12 years worth of returns?” moderator Brian Williams asked at last night’s NBC News/National Journal/Tampa Bay Times debate.
“You know,” Romney replied. “I agree with my dad on a lot of things but we also disagree, and going out with 12 years of returns is not something I’m going to do. I’m putting out two years, which is more than anyone else on this stage. I think it’ll satisfy the interest of the American people to see that I pay my taxes, where I give my charitable contributions to and it think that’s the right number.”
Reuters analyzed “what Romney’s tax returns reveal–and omit.” Excerpt:
Much of Romney’s fortune likely qualifies as what is known as “carried interest,” a share of profits earned by private equity managers taxed at the 15 percent capital gains tax rate rather than the maximum 35 percent wage rate. Private equity managers, some hedge fund executives and venture capitalists benefit from carried interest.
Campaign officials said Romney had carried interest of $7.4 million in 2010 and $5.5 million in 2011.
Critics say the 15 percent rate for carried interest is an unfair tax break because investment managers, as Romney was, are providing a service that should be taxed at the higher rate paid by wage earners. […]
Romney’s investment funds run through Bain are in offshore tax havens such as the Cayman Islands, a practice the campaign insists is legal and common but that has come under some criticism during the campaign.
The Romney campaign’s answer to questions on this front has been that he does not control the makeup of the funds because they are run as blind trusts. […]
[Director of Romney’s trusts Brad] Malt said that at one point money had been placed in a Swiss bank account and that this had been meant to diversify the portfolio but, aware that some such accounts are used to evade taxes, Malt decided to close it in early 2010 to remove a potential source of embarrassment. He said the account was never meant to evade taxes, and no taxes went unpaid.
Jordan Weissmann answers a few questions about Cayman Islands tax havens at The Atlantic website.
Any relevant comments are welcome in this thread.