Home / General / Romney campaign releasing tax information

Romney campaign releasing tax information


In what very much smacks of sheer panic, the Romney campaign is suddenly releasing a whole bunch of the candidate’s tax information:

Romney camp: In 2011, the Romneys paid $1,935,708 in taxes on $13,696,951 in mostly investment income.

Romney camp: The Romneys’ effective tax rate for 2011 was 14.1%.

The Romneys donated $4,020,772 to charity in 2011, amounting to nearly 30% of their income.

The Romneys claimed a deduction for $2.25 million of those charitable contributions.

Romney camp says they could have written off more of their giving but didn’t so that Romney’s tax rate remained over 13%

A notarized letter from PWC will also be released re tax returns for last 20 years

PWC letter will say: Over the entire 20-year period, the Romney’s average annual effective federal tax rate was 20.20%.

PWC: Over the entire 20-year period, the lowest annual effective federal personal tax rate was 13.66%.

PWC: Over the entire 20-year period, the Romneys gave to charity an average of 13.45% of their adjusted gross income.

Couple of points:

(1) Assuming these numbers are correct, it’s hard to see why they didn’t release all this stuff months ago. Sure it’s bad, but given that the candidate is a Galtian Overlord it could hardly have been better, and there was naturally much speculation that it was worse. (The fact they’re dumping this on a Friday afternoon indicates they’re still spooked about the whole thing).

(2) If you are employed and make less than $110,000, then normally you pay a higher effective federal tax rate than Romney did in 2011, even in years, if any, in which you pay no federal income taxes. This is because normally you pay 15.3% of your income in FICA and Meditax (the employer contribution is in economic terms a straight deduction from what would otherwise be your wages).

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  • mark f

    What a doofus:

    Romney in July: “If I had paid more [taxes] than are legally due I don’t think I’d be qualified to become president.”

    At this point I half expect him to show up at a debate claiming that the backwards “B” on his cheek was carved by Obama.

    • tonycpsu

      And he releases the info a day after the house GOP passed their bill to add a checkbox for paying more taxes voluntarily to pay down the debt, in an attempt to make a point that nobody will want to pay extra to pay down the debt a la the Buffett Rule.

      So paying extra taxes to make yourself not look like as much of a greedy loophole-chaser is a political winner, but paying extra taxes to pay down the debt makes you a sucker.

      Good to know!

      • And he will simply amend his return later to include the charitable deductions he didn’t take, thereby recovering the extra taxes he had to pay to make himself look good right now.

        He really thinks we’re stupid. He really does.

        And who said anything about 20 years, over which the rules on capital gains taxes changed, etc.? The questions are about the tax rates during the last ten years.

        Also, the PWC letter could have been written on the basis of returns that he has just AMENDED (1040X). He could have amended all his returns going back 7 years (I think that’s the limit) in order to drive up his tax rate for the purposes of this letter. He would pay the taxes and the penalties out of his petty cash. That could be why this little “note from my accountant” dodge took so long to organize.

        After the election he RE-amends those returns and gets the money back from the IRS. Easy peasy. PWC can be telling the truth now, but in the end, Romney’s real taxes PAID over the last 10 years could still end up at or near (“effectively”) zero.

        • BobS

          Right. An average rate over the last 20 years includes the years before the Bush tax cuts.

  • (the other) Davis

    Do “charitable contributions” include his tithe to his church?

    • MAJeff


    • Sherm

      Presumably as such payments are deductible, unfortunately.

    • Warren Terra

      I thought that was 10% – what the heck is the other 20%???

      • mark f

        “Running for POTUS”

      • Holden Pattern

        “Being Stake President.”

  • Jay B.

    Paul, I disagree. I know why they didn’t release this months ago: This is a straight up argument against the current tax code and is a prime example of why it should be made more progressive.

    Plus PWC can kiss my ass.

    • catclub

      Notarized, schmotarized. I bet there is no penalty for perjury in what the letter says.
      So no risk, or reason to be correct.

      • Malaclypse

        I think all “notarized” means is that the notary is attesting that the letter is really signed by PWC.

        I’m not sure what the penalty for a bad summary would be for PWC.

        • Richard

          There would be no penalty because the affidavit isn’t being submitted to a court, bank or a government agency. But I dont think a hotshot CPA would risk his career by submitting a false affidavit either.

          • Jon

            Funny, I thought their job was to give the money men the numbers requested and then sign on the dotted line.

          • DrDick

            Please! We know that they routinely lie about corporate audits and have plenty of reason to assume that they do so for wealthy individuals.

          • rea

            But I dont think a hotshot CPA would risk his career by submitting a false affidavit either.

            Google “Arthur Andersen” and “Enron”.

        • Dennis

          It would cost them far more in lost income from the damage to their reputation than every last cent Romney has to his name, if you think they took a bribe. That’s a ridiculous contention to think PWC would lie for a presidential candidate because he asked them to.

          • Holden Pattern

            Yeah, there is no history at all of top tier accounting firms being willing to lie on behalf of people who could steer business their way. (*cough*ArthurAndersen*cough*)

          • They don’t have to lie if this statement is being made on the basis of hastily amended recent returns.

        • Arthur Anderson, LLP

          But I dont think a hotshot CPA would risk his career by submitting a false affidavit either.

          Definitely not.

          • Richard

            I think many a CPA would be willing to lie if he thinks he wont get caught (Enron and other scandals). I dont think many CPAs would think that blatant lies released to the press about a candidate for President would not be caught

    • Warren Terra

      You’re not wrong, but assuming their claims about the past twenty years are true (for the sake of argument), his past tax-paying behavior probably falls within the least-bad-news area of the speculation about it. I.E., it still supports the idea that rih folks are paying too little and we need genuinely progressive taxes – but it was seen as being a fairly conservative speculation that in some recent year Romney paid under 10%; it was seen as quite plausible that he paid nothing at all, or nearly so, in some years.

      Of course, that was “assuming for the sake of argument”. In reality, these claims are fairly worthless. For one thing, he could simply be playing games regarding what he considers to be the denominator in his calculations. So long as it’s not his gross income, it’s meaningless.

      • Cody

        Without his details, it’s impossible to find. It could be one year he paid a 30% effective tax rate as he dropped $500 million into a Swiss Bank Account.

        We’ll never know because he won’t release his details, claiming this is all we need to know.

        To be fair, no one should care whether or not he did this. He has plenty of faults.

      • laura

        The campaign had promised the 2011 release and was probably holding it back until they needed a “conversation changer”. This doesn’t strike me as political malpractice, and certainly not by Romney Campaign standards. They probably played this as well as they could. The 20 year “summary” of Romney’s taxes was probably thrown in to distract conservatives into beating up on Harry Reid rather than focussing on the failings of Romney’s campaign.

        • Decrease Mather

          I agree with this. They held it back until the point where it looked like a reasonably good thing to talk about.

          • spencer

            Decrease Mather says:

            I love this nym.

        • Hogan

          Someone said on NPR yesterday that it shows what a bad week that campaign was having that they thought changing the subject to Romney’s tax returns was a good idea.

  • Halloween Jack

    Romney camp says they could have written off more of their giving but didn’t so that Romney’s tax rate remained over 13%

    TPM says that the deduction was deferred. So, basically, they should be able to claim it later, right?

    • sparks

      No worries. Win or lose, there will be a post-campaign amended return.

    • Richard

      I dont think that is the true. If you made the charitable deduction this year, I dont believe you can claim it in a later year. It has to be claimed in the year it was made just like if you received income this year, you can’t elect to treat it as income for the next year. I’m not a tax expert so would invite anyone with expertise to give a more definitive answer.

    • cpinva

      i found that rather odd, since the code doesn’t allow an election for charitable contributions: you deduct them in the year you made them, unless, for some reason, you can’t. then you carry the unused portion forward, for a maximum of 5 years (i believe), and hope you can use it. you don’t get to elect when you’ll deduct them.

      TPM says that the deduction was deferred. So, basically, they should be able to claim it later, right?

      the romneys are cash basis taxpayers, they report income when they have constructive receipt of it, and deductions in the year cash payment is made. if PWC actually pulled a stunt like this (and i doubt that, i’ve worked with them, they aren’t that arrogant, even for a high dollar client like the romneys), they’d be looking at more than just a wrist slap, from both the IRS and the state board of accountancy. so i’m guessing someone didn’t understand, and simply mis-spoke.

      • Richard

        The PWC statement doesn’t say the deduction was deferred. (TPM said deferred but that seems to be a mistake not based on anything stated by PWC). It just says the deduction was limited to a certain amount. So its pretty clear that they can’t claim the unused portion of the deduction in a later year.

      • They just file an AMENDED return (1040X), which would include the contributions they “forgot” to include on the original.

    • So, basically, they should be able to claim it later, right?

      Yes. And you can be sure they will.

      I expect them to file an amended return on November 7.

      • Halloween Jack

        What happens to a deduction deferred?

        Does it dry up
        like a raisin in the sun?
        Or fester like a sore—
        And then run?
        Does it stink like rotten meat?
        Or crust and sugar over—
        like a syrupy sweet?

        Maybe it just sags
        like a heavy load.

        Or is Mitt a choad?

  • Sly

    LDS requires a 10% tithe from all members which can be written off as a charitable deduction. I have no reason to believe the Romney’s have been shirking their religious obligations, and will assume that this tithe makes up a sizable chunk of their charitable givings.

    And though the Church does put a lot of that money to good use, they also use it to fund anti-gay political groups and send overeager young men in sleeveless white shirts and black ties around the world to lecture poor people about the Angel Maroni.

    Regardless, we’re probably going to hear endless praise from wingnuts (many of whom firmly believe that LDS is a non-Christian cult) about how great the Romneys are because they give so much to “charity.”

    • Cody

      We should make sure ever Liberal that talks about his charitable donation drops in “The tithe to LDS”, to make sure the real evangelicals don’t come out to vote!

    • STH

      And plenty of that money goes to building these temples (I live near the one in the Tri-Cities, WA, and it’s quite an edifice and many times grander than any other local church).

      • sparks

        Does the Tri-Cities temple really look a garbled interpretation of the many Federal Reserve Banks IRL?

      • Davis

        While skimming your link, I came across this:

        The very first temple I ever did baptisms for the dead for was in Idaho Falls. It is what I requested to do for my twelfth birthday.

        A 12th birthday wish.

        • sparks

          I saw that one, too. Kinda horrifying, isn’t it?

      • Most of those are very beautiful buildings.

        Except the Seattle Temple. Pointy Deluxe Ho-Jo’s.

        The one Mitt helped build in Belmont, MA, outside of Boston, is a bit austere for my tastes, but classy enough.

        • Richard

          The one in Los Angeles is amazingly ugly.

          • Yuck.

            The others all manage to pull off the big golden guy with a trumpet standing on top of the steeple, by making sure the rest of the building is solemn and sturdy.

            Palm trees? Golden epaulets?

            HOO-RAY FOR HOLLYWOOD!!1!!1!!

            • sparks

              Seeing that, I just flashed on Jack Webb…This is the city, Los Angeles, California. I am a Mormon, I live here. I carry magic underwear.

              The modern temples I’ve seen here look like something other than what they are. The old ones look like a different religion’s church. There’s one two doors down from me which has modest Southwest architecture.

        • efgoldman

          The one Mitt helped build in Belmont, MA, outside of Boston, is a bit austere for my tastes, but classy enough.

          The thing is, its huge, in a residential neighborhood, and they lied about it when they bought the land, parcel by parcel. (In MA, local zoning laws cannot in any way be used to prevent building a house of worship, or to require modification of the plan except to conform with building codes.

      • Halloween Jack

        Mormon temples are kind of fascinating to me, for a number of reasons. I toured the one in Memphis before it was dedicated, and although it was very nice, there was also the weirdness of it being closed to outsiders after dedication; you need something called a temple recommend to get in, which you can only get a year after being baptized and it’s only good for 2 years (and they give you a quiz each time). The windows are made of translucent glass; the only clear window in any temple is the one overlooking the “Sacred Grove” (or where they think it was, anyway) near Palmyra, New York, where Joseph Smith supposedly had his vision of the angel Moroni. Oh, and during the tour, we were flanked by guards the whole time, just in case we tried to plant bugs, I guess.

        There are 138 temples, which doesn’t seem like a lot compared to other churches, but there were only about 20 up until the early eightes; between 1998 and 2001, the number doubled from 51 to 102.

  • Jim Lynch

    Hunter of Daily Kos notes: “..Mind you, he’s still not releasing those tax returns. He’s released the much-promised 2011 version, finally, but the rest of it is not really tax returns, but an artist’s interpretation of what his tax returns would look like, if he did release him. A very polite and notarized letter from his mother doctor accountant saying please excuse Mitt Romney from releasing his tax returns as other presidential candidates have. I sincerely promise everything is on the up-and-up in there and there is no reason to look any further; signed, some guys paid by Mitt Romney to say this.

    Well that should do the trick, no? What sort of monster would not be satisfied by that?..”

    • Phoenix_rising

      Umm, the kind of monster like myself who wonders:

      Exactly how big were the offshore accounts that he took the one-time amnesty on in 2009?

      Because there is no other remotely credible explanation for this shitshow.

  • gnarlytrombone

    “Over the entire 20-year period, the Romney’s average annual effective federal tax rate was 20.20%.”

    Q: Hey gnarlytrombone, have you ever engaged in binge drinking?

    A: My average beer consumption between 1990 and 2009 was one can a day.

    • Warren Terra

      There’s also a line about him never paying less than 13%, though …

      Mind you, I think this sort of Note From Mom is meaningless. I want the returns. But if you’re going to criticize what the note says, criticize everything it says, not one line.

      • gnarlytrombone

        Yabbut was it paid, or eventually paid?

        • Patrick

          From the Romney web site’s blog post “During the 20-year period covered by the PWC letter, Gov. and Mrs. Romney paid 100 percent of the taxes that they owed.”

          Now that could be inelegantly stated, but it seems to leave weasel wording to be true even if a portion wasn’t paid/reported on time and then was paid later, say through an amnesty program.

      • Boots Day

        The release says he never paid less than 13 percent in “effective federal personal tax rate.” If you Google that phrase, you’ll find out it was expressly created for the purposes of this Romney tax report. So it basically means whatever Romney and PWC want it to mean.

        • Holden Pattern

          Here’s a thought: that massive IRA’s income isn’t taxable, so any money that earns isn’t actually in his income — I don’t think there’s even a reporting obligation on income within tax-sheltered retirement accounts.

          So all of his tax-sheltered investments would be completely outside of that rate calculation. Huh.

          • Richard

            Of course. But that’s always the case for everyone. You only pay taxes on IRA accounts once you start drawing from them which he hasnt. Once he starts drawing from them, that would be reportable income but not before

            • JoyfulA

              He’ll have to start drawing from them at age 70.5, which is 5 years from now.

  • njorl

    it’s hard to see why they didn’t release all this stuff months ago.

    Too many “Mitt is part of the 47%” jokes popping up now?

  • David Hunt

    PWC letter will say: Over the entire 20-year period, the Romney’s average annual effective federal tax rate was 20.20%.

    A 20 year average can cover up a host of sins. I’m going to take a wild guess that that the Romneys’ effective tax rates for all of those 20 years have been close to the rate of long term capital gains, just like the two years of 2010 and 2011 that we’ve got specific numbers on. Before the Bush tax cuts, the maximum rate was, I think, 28% but it was lowered to 20 and then 15% His more recent returns would almost certainly be at closer to the c14% that we’ve seen. I don’t believe he’ll release the actual returns from that period as they’d be a graphic example of why all the billionaires are willing to pump money into his campaign: It’s a good investment. If they can keep the Bush tax cuts form going away they’ll save shattering amounts of money. I think we’d also see that Romney personally used to pay a lot more in taxes on his income but that the amounts have fallen dramatically, starting in about 2001.

    Finally, I don’t think that he’ll be releasing the actual returns, because I think he took the 2009 amnesty that was available to the tax cheats who finally reported their Swiss bank accounts. If I’m right, he’d be admitting that he was defrauding the U.S. government for years and that he’d gotten away with it. Most days, I don’t think that would be a net positive for him.

    • Steve H

      Even if it’s just a PWC summary, I would like to see the year-by-year breakdown, just so we could figure out how many millions of dollars he has saved because of the Bush tax cuts.

      • David Hunt

        My point exactly…or one of them. Thanks for pointing that out explicitly. I did a poor job of it.

  • Malaclypse

    Do we know whether or not Romney took part in the 2009 Swiss bank amnesty thing? Or does the “summary” omit this?

    • Patrick

      So far it appears to omit it, which in my mind encourages the conspiracy mongering. If he really paid no less than 13% in any year why in the world would he be taking this much heat instead of just releasing the returns? The amnesty is really occam’s razor explanation at this point.

      • Jameson Quinn

        Amnesty, state of residence, or something else. If he’s not releasing it all, he’s hiding something. It actually would be irresponsible not to speculate.

      • mark f

        Plus Ann said the Romneys would just be attacked if we saw the returns which totally don’t have anything worth attacking in them.

        • sparks

          They took Rafalca as a dependent child.

          It would be irresponsible yada, yada…

    • Barry Freed

      It’s got to be the amnesty thing.

    • swearyanthony

      That has to be the reason for the line in the sand. Note that he was happy to give McCain his tax returns, but that was prior to 2009 and the amnesty.

  • arthur

    If he’s not hiding the amount of taxes he paid in prior years, he’s hiding something else. My money is sitll on the “number of dependents” line.

    • Malaclypse

      More likely state of residence. I won’t be surprised if he was a resident of New Hampshire, and thus not eligible to be Governor of Massachusetts.

      • Warren Terra

        Nope. This is a matter of settled fact: for the purposes of paying taxes, Mitt was a resident of Utah, and thus not eligible to be governor of Massachusetts. He got around this by saying he was sorry, blaming an overzealous accountant, and paying a tiny amount of back taxes he’d have paid had he remained a resident of Massachusetts.

        There’s probably something hidden in those returns, but the one you speculate about isn’t it.

        • Cody

          Maybe he’s not actually a resident of the United States, and has dual-citizenship in Mexico as that’s where his family is from?

          • Richard

            The two returns he has released show him as a resident of the US – without question, the others do as well. Plus dual citizenship, which is exceedingly unlikely and would not be reflected on the tax return, is not a bar to running for president. You’re sounding like a birther

            • Cody

              I was just throwing out crazy conspiracies! I thought that’s where we were going in this thread.

              • Richard

                OK. I understand. I definitely think that is where the thread is going.

          • rea

            Anyway, the dual citizenship guy would be his dad–Mitt, born in this country, is an anchor baby.

  • Barry Freed

    It’s been said before but these are not Romney’s tax returns.

    But by all means let’s keep him talking about this.

    (Also, where is the info on his Swiss and Cayman Island bank accounts? And who the hell wants a president with Swiss bank accounts anyway?)

  • mds

    So, let me see if I follow this. They deliberately deferred a portion of the deductions on their just-filed 2011 taxes to avoid being caught out by Romney’s own claim of a >13% rate over the last decade. If he hadn’t made that statement, they would presumably have gone ahead and paid ~9%, according to Dan Froomkin on the Twitter-twatter. And they apparently still get to deduct it later. And this is meant to be a helpful distraction from the 47% thing?

    • Richard

      They dont get to deduct it later. See discussion above

      • rea

        They get to deduct it later in the sense that they can wait until after the election and file and amended return.

        • Richard

          That would be a possibility. Filing an amended return later that includes the total amount of contributions made. What they can’t do is claim the not taken deduction against 2012 income

          • rea

            Well then isn’t it clear that he’s just playacting to bring his numbers in line with the 13% he had previously stated in public, and that as soon as it no longer matters he’ll take the deduction?

            • Richard

              I dont think its clear that he’ll file an amended return later. He’s rich enough that the extra million or so doesn’t matter and he might prefer paying it rather than get the bad publicity of revealing the transparent ploy he engaged in (assuming the public would find out about an amended filing in the event he got elected President).

              • The transparent ploy is already really, really translucent!

                Since the IRS isn’t going to tell anybody about an amended return, what does he have to lose by filing one after the election.

          • But they can still get this year’s DELIBERATE overpayment amount back from the IRS!

            They lose NOTHING.

            • Dennis

              Anyone could do that, it’s call an amended tax return. If you think you donated more to charity than you claimed when you filed this past year for 2011, or for 2010, you can do that, too, Julia. Mitt Romney is no different than any other US taxpayer in that regard.

              • Right.

                But I didn’t deliberately not claim a deduction I was entitled to in order to make my tax rate HIGHER, so that I would look good to the electorate/stay in line with my earlier claims to have always paid more than 13%.

                Romney is trying to pretend that he has oh-so-nobly foregone all these extra deductions that he could have taken, and therefore paid more than he had to. I’m pointing out that he can get all those nobly paid extra taxes BACK with a 1040X filed as soon as the election is over.

  • kathleen

    Don’t get all excited. First, these are not Romney’s taxes, they are what some Romney hired hand says are Romney’s taxes. We should believe him because? Second, a 20-year average includes a lot of years before the Bush tax cuts for millionaires kicked in, so the 14% rate is artificially low. In other words, he managed an average of 14% even with at least half the alleged reporting at higher tax levels.

  • KWK

    So is the 20% “annual average” arrived at by summing the rates paid each year and dividing by 20, or adding up the total taxes paid over 20 years and comparing it to the total income over 20 years?
    In other words, did he pay 13% on $100 million one year and 27% on $10 million the next year, and then call 20% the “annual average” of those two?

    • Steve H

      I can’t remember who (Greg Sargent?), but I believe it is the former – an average of the rates, not a total average taking all taxes and all income over 20 years.

      But realistically, wouldn’t you expect the rate to be higher if the income for that year was higher? So while it is possible the average is gaming the system as you suggest, I kind of doubt it.

      • sparks

        When an average doesn’t state what is being averaged, always look for the interpretation that best suits the one who requested it.

  • Calming Influence

    This is WAY worse than not releasing tax returns at all. Why go through the trouble of averaging over 20 years?

    * Because if the tried to average over less than 20 years the average would be even lower?

    * Because somewhere in the last 10 years (the number of years most people see as acceptable) he paid 0% or something close to that?

    * He had to take the amnesty in 2009 for unreported Swiss bank interest?

    This only makes it crystal clear that he’s hiding something.

    • Cody

      No, the headline will still read “Romney releases tax returns”. Or hopefully they will (for him).

      That’s obviously his plan here. The intention is to placate the masses. Perhaps we realize this can hide anything, but next time someone on CNN asks “Where are Romney’s tax returns” someone will respond “they were realized on 9/21! Don’t you remember?”

      • No, the headline will still read “Romney releases tax returns”. Or hopefully they will (for him).

        It’s still material for a political win. “Those aren’t his tax returns, it’s a letter and Mitt is chicken.”

      • The headline should read “Romney releases amended tax return, alleged summary of past taxes”

    • Jim Lynch

      “Why go through the trouble of averaging over 20 years”?

      That’s a excellent, Pulitzer Prize caliber question.

  • James E. Powell

    Everyone, not just Harry Reid, has to keep insisting that he release returns, not summaries, not commentaries, not anything but IRS forms signed by Mitt Romney under penalty of perjury.

    Anything else is just talk.

    • Dennis

      Either Harry Reid lied on the floor of the House when he said Romney paid no taxes the last ten years, or Harry Reid is saying PriceWaterhouseCoopers is lying by certifying that he in fact did pay taxes the last ten years, and paid an effective rate of 20% the last 20 years.

      One or the other. Harry Reid is saying a lot, but he won’t admit he lied, despicably.

      • JoyfulA

        Reid’s a senator, not a congressman, and what he said was that someone in a position to know told him about Romney’s taxes.

        • Anna in PDX

          Frankly there have been so many lies told brazenly on the hallowed floors of both houses of congress that this comment is just a parody. Senator says “I have been told X” where X isn’t true? Oh no, where is my fainting couch?

  • Leeds man

    A notarized letter from PWC

    I’m appalled that the Queen has to put her Pembroke Welsh Corgis to work to earn their keep. Especially such demeaning work.

    • Bill Murray

      I thought it was Paulsen, W. and Cheney

    • firefall

      It’s another of Harry’s pranks

  • Incontinentia Buttocks

    You know it’s been a bad week for them when Team Romney decides that its best play is to return the conversation to Romney’s tax returns.

    • Richard

      Fully agree. But given the fact that he had promised to release the 2011 return so it was just a question of when (and not if), getting the conversation away from the 47% quote is probably the right move.

  • pylon

    At Greg Sargeant’s place, the point is made that this is an average of the rates over the 20 years.

    It’s not an average obtained by taking his income over the 20 years and the taxes paid over that same 20 years.

    The latter would be a more accurate summary of what percent of his income Romney has paid in taxes.

    • Richard

      Thats my take as well. This appears to be an average of rates. So he could have paid 15% on income of twenty million one year and 25% on income of two million another year. The average rate paid would be 20% even though the tax he paid on actual income would be considerably lower.

      • Dennis

        The odds of large movements like that are low for someone of his wealth and income-generating capabilities from that wealth, not to mention you’d be claiming an almost 20yr strategy for that, as if he knew some day he would have to release a tax summary from PWC of his effective rates averaged over 20 years, where he purposely paid a much higher effective rate in the years he earned the least.

        In short, you’re going truther and birther at the same time. Fire never melts steel, grassy knoll, Vince Foster was shot by Hillary Clinton and all that.

        • nixnutz

          That’s a cute comeback but it’s basically backwards. Romney didn’t “have to release a tax summary from PWC of his effective rates averaged over 20 years”, rather he picked that odd data point to release out of a mountain of data. The traditional thing, and what was demanded of him, is that he would release actual returns from probably a smaller number of years. No doubt they picked this tiny sliver of data because it shows the situation in the most flattering light. An average of rates over 20 years? That’s not even a summary of an executive summary.

          I don’t think it’s particularly meaningful that the figure for percent of income paid over 20 years is probably slightly different, it’s more that it’s just not a very illuminating figure by itself.

        • Cody

          Also, there is a story somewhere on this blog linking to the article about a young Mitt Romney. He stated he was “one day going to become President” when he was 16.

          So obviously he’s been planning this for a while…

  • Tucker

    Yep, from the Adam Sandler movie, “Billy Madison”, “…for you the topic I choose is business ethics.”

    Couldn’t have written a better script.

  • Corey

    Yglesias: Why Mitt Romney’s Effective Tax Rate Is So Low And Why It Probably Should Be

    Gotta say, I was defending the guy earlier, but this is one of the dumbest things he’s ever written.

    • Leeds man

      To be fair to Yglesias, his article is a bit more nuanced than the title, which he may not have chosen anyway.

      On the other hand, his two scenarios are rather contrived. “In the world where investment income is taxed like labor income” the investing doctor would still save money, no?

      • Corey

        The whole thing rests on the implicit conflation of “investment” – the building and hiring that the hypothetical doctor does, and “Wall Street”, where Mitt Romney puts his money. Lots of what Wall Street does is “investment’ in the former sense, but lots of it isn’t productive for the economy at all.

        • Leeds man

          I get that Corey, but even ignoring the conflation, his little Gedankenexperiment is suspect. Would a real investor suffer inordinately from a tax on investment income?

      • Incontinentia Buttocks

        To be fair to everyone else, just ignoring Big Media Matt is really the best course of action.

      • Yeah, that’s what I was thinking. It really makes no sense. He’s mixing up encouragement to invest with encouragement to have your income be characterized as investment.

        And on that note, he only acknowledged the carried interest scam at the very end and ignored the way in which the big distinction in treatment likely causes more complication in tax returns, as people with large incomes and some flexibility (like lots of CEOs) will try to get as much of their incomes as possible designated as capital gains and not wages.

      • Perhaps I’m just groggy, but doesn’t Matt make a mistake comparable to people who think that they’ll have more after tax income if they avoid getting into a higher marginal tax bracket?

        In the world where investment income is taxed like labor income, the first doctor says to the second “man you’re a sucker—not only are you deferring enjoyment of the fruits of your labor (boring) but when the money you’ve saved comes back to you, it gets taxed all over again. Live in the now.”

        What? Wouldn’t the capital gains be what’s taxed, not the total savings? So, any particular doller is only taxed once. So the correct spiel would be:

        In the world where investment income is taxed like labor income, the first doctor says to the second “man you’re a sucker—not only are you deferring enjoyment of the fruits of your labor (boring) but when the money you’ve saved comes back to you, the extra money you earned gets taxed as if you had worked extra hours, only you didn’t have to work those extra hours. Can I borrow some money to fund my elder hostal trip?”

        Did I miss something?

    • liberal

      Agreed. He cites as evidence economics textbooks, but AFAICT the empirical evidence for what he’s claiming is extremely weak or nonexistent.

      • sparks

        That’s our Yggy, one time dubbed Big Media Matt, an epithet I’d like to slug a certain Mr. Black for using repeatedly.

  • Stag Party Palin

    Romney camp: In 2011, the Romneys paid $1,935,708 in taxes on $13,696,951 in mostly investment income.

    Romney camp: The Romneys’ effective tax rate for 2011 was 14.1%.

    Looking at the PDF in question, I see 20 million in gross income, and 3.2 million in taxes owed. IOW, nothing like the above statement. Apparently, the “comments” are about a return we can’t see. So, no tax returns have been released after all.

    • Incontinentia Buttocks

      Whatever happened to American values? That’s what four-years of Kenyan Islamofascism has done to the American people: we are no longer willing to trust our social betters. Poor Willard, Ann…and Rafalka, too!

    • Jon

      Mitt lost $7 million between January and today, won’t you help him recover his money?

      To help, he’s even added a bright red “Contribute” button on his final version of his taxes, so those of you moved by his transparency can tack on a few measly thousands to his $13.6 million in reported income.

    • Richard

      The 2011 returns are here.


      The PDF you’re linking to is the preliminary, unfiled return from earlier in the year. There is still the question of how $20 mil projected earnings from the unfiled return evolved into a $13million gross on the final return

  • chris9059

    “The Romneys claimed a deduction for $2.25 million of those charitable contributions.
    Romney camp says they could have written off more of their giving but didn’t so that Romney’s tax rate remained over 13%”

    If Romney doesn’t get elected (and maybe even if he does)you can be damn sure he will amend that return and claim that additional write-off.

    • Yep.

      Like I said, they’ll have that 1040X all filled out and ready to shoot off to the IRS on the morning of 7 November.

      • Richard

        Only if he gets defeated. Incumbent presidents disclose tax returns and he’s not going to want to reveal an amended return. But I agree there’s no downside in filing an amended return if he loses

        • Dennis

          This is just silly, anyone can file an amended tax return.

          Within three years from the date you filed your original return or within two years from the date you paid the tax, whichever is later.

          You can amend anything on there.

          You, Richard. And I can, too! So can Mitt Romney. And Barack Obama. All of us can.

          Isn’t this fun, we can say whatever we want to about what someone else could be doing with their taxes, even though we no clue or any evidence whatsoever. It’s awesome!

          • Barry Freed

            I know, it’s a wonder he hasn’t just released the returns and put an end to all this speculation, isn’t it?

            • Dennis

              Barry, you’re deluding yourself if you think his releasing his returns now would put an end to all this speculation. It would generate a thousand times more speculation. Just a quick perusal through the comments section of any blog dealing with his taxes shows you that a very large percentage of the population even knows the difference between marginal and effective tax rates, or that dividends are taxes at a lower rate than wages, or that a person living off their investments will have a lower effective rate than someone else’s marginal rate. Romney could release every last detail of his IRA amount and it could all be perfectly legit, and the odds that it was are high given PWC does his taxes, but the average person out there would be clueless about it and the average financial reporter writing about it would still say all the details weren’t in and that Romney got an advantage that the average taxpayer doesn’t have, and the average voter will just take that in and assume Romney was still hiding something.

              You guys are seriously going birther with this.

              • Barry Freed

                I just want to see the long form Dennis.

                And I don’t think many Americans are or should be comfortable with a President who has Swiss and Cayman Island bank accounts.

                • Dennis

                  Do you realize how many banks have Cayman bank branches and how many money market funds and investment funds and pension funds and endowment funds and just about every institution with short-term cash uses Cayman branch deposits for their fund assets? And by extension how many Americans have their money invested daily in assets using Cayman branch deposits? Any clue at all?

                • Dennis

                  And Barry, we already know he has a Cayman Island bank account. You don’t need the long form for that.

                • Dennis, “Cayman BRANCH deposits”?

                  Get serious. You think people here are as ignorant as you accuse everyone else in America of being?

                  Mitt’s deposits were in actual, foreign, Cayman Island banks, not Cayman branches of American banks.


              • BobS

                Releasing his returns would put an end to speculation by confirming that speculations about his returns were essentially true.

              • >>You guys are seriously going birther with this.


                If he hasn’t done anything shady, he should just release the damned returns and get it over with.

                In fact, politically speaking, if he’s innocent of wrongdoing, and has merely been afraid of ignorant commentary on perfectly legal matters (all of which supposedly could have been corrected with facts and explanations), holding the tax returns back was a HUGE mistake. If he had released them several months ago, all that ignorant squealing/public explanation business would have died down by now.

                Why wouldn’t any sane, honest man just…ah.

                I see. Perhaps there are things in those returns that are NOT just easily misunderstood by the financially ignorant….?

                Logic. It’s a harsh mistress.

  • heckblazer

    The notarization certifies that the letter was signed on behalf of PWC and “is an authentic document prepared by the Firm”. Even if it doesn’t rise to perjury a false statement sounds like it would be pretty bad for PWC. Therefore I expect everything in the letter is absolutely technically true. The trick then is to figure out how the statements are perfectly true but grossly misleading.

    The question that springs to my mind is if taking advantage of the 2009 amnesty entailed paying back taxes on the stashed money. If so, that could mean that Romney wasn’t paying income taxes until 2009, whereupon he retroactively paid off everything. That could also mean Reid’s rumor is still right in the sense that Romney didn’t cut a check to the IRS for 10 years.

    • Dennis

      And you sound like you’re going into serious, serious conspiracy theory-mongering. You can pretty much say anything you want to about someone’s taxes when you don’t have them in front of you.

      • The Dark Avenger

        You can pretty much say anything you want to about someone’s taxes when you don’t have them in front of you.

        Which is why Romney doesn’t release them, he’d rather risk conspiracy theories than to have any of them confirmed by the truth of what is in his taxes for 2009.

        • Dennis

          The conspiracy theories wouldn’t stop with the tax return release. The tax returns wouldn’t give opponents near enough information to satisfy them or answer their endless questions, it would just give them the opening they’re looking for to ask ten times more questions, which IS exactly what they’re hoping for, since the average voter doesn’t know the difference between marginal tax rates and effective tax rates, or that investment income is taxed at a different rate than wage income.

          The bottom line here is either Harry Reid is lying and owes everyone an apology and a severe rebuke from the Senate, or there is a new Truther movement alive where people think PriceWaterhouseCoopers and the IRS are colluding by lying about Mitt Romney not paying ANY taxes the last ten years. One or the other, my very strange stalker friend.

          • djangermous

            Or El Romno can do like all the other presidential candidates and release his tax returns.

        • heckblazer

          I’d just add that I haven’t accused Romney of doing anything criminal, or frankly unusual for a multimillionaire with off-shore bank accounts.

      • Leeds man

        You can pretty much say anything you want to about someone’s taxes when you don’t have them in front of you.

        My God, it’s as though Obama supporters are milking this for all it’s worth. Does their perfidy know no bounds? When oh when will this “it’s irresponsible not to speculate” nightmare end?

      • heckblazer

        Looking for assumptions, hidden or otherwise, that could cover up undesirables is exactly how I would read the letter if it was a document in a business transaction.
        And of course if Romney followed the example of his own father when he ran for president we would have the last ten years of Mitt’s tax returns in front of us.

      • (the other) Davis

        And you sound like you’re going into serious, serious conspiracy theory-mongering.

        In what way is suggesting that Romney may have behaved much like many other multimillionaires did a “conspiracy theory”?

        • Dennis

          I characterized the lengths heckblazer was going to in order to say that Harry Reid might possibly have been telling the truth. PWC has a lot at stake to be lying or trying to cover up something for Mitt Romney such as not paying taxes. PWC has a lot at stake to even be accused and found to be providing grossly misleading statements, which is what would have to be the case for Harry Reid’s allegation to be even remotely true. So either Harry Reid’s source was lying to him, if he existed and Harry Reid recounted truthfully what he told him, or you think PWC and the IRS are colluding to lie about Romney’s taxes. That’s a fairly large leap of faith if you ask me, akin to the truther, birther and Kennedy conspiracy theories.

          • Who pays the bulk of PWC’s fees? Corporations and wealthy individuals who are doing their best to avoid paying taxes while avoiding the impression that they’re trying to avoid paying taxes. That PWC would do this, as long as they aren’t actually lying, makes them look good to their core markets.

            • Dennis

              Except that Mitt Romney is running for president and every chief person at PWC would’ve been involved in that decision, including their top legal staff,and if anything in that summary was false or misleading, they have far, far more financial downside risk than they do upside. It’s just not a good bet to make, so bad, in fact, as to be absurd to think they’d make it knowing it was a misrepresentation of the facts.

              • If rich and powerful people found out that PWC shaded the truth to their client’s advantage, do you think their business would get better or worse?

                You’re probably right, but I really don’t think they’re lying. “Misleading” isn’t really a legal standard they could be clubbed with, as long as they were not actually lying.

                I think they’re leaving out important information that would allow us to properly interpret the conclusions presented. And I think they’re fine with that, as are their clients.

                • heckblazer

                  Here’s an example of what I’m talking about:

                  Q. Has Richard Nixon ever been impeached or convicted of a federal felony? Please answer ‘yes’ or ‘no’.
                  A. No.

          • heckblazer

            I should emphasize that I’m not finding any fault at all with PWC here. I believe they are giving absolutely truthful answers to the questions asked by their client. That the client may be asking misleading questions is the problem.

            My defense of Reid is supposed to provocative speculation, and I guess I successfully provoked :). To my layman’s eyes the way the letter is phrased allows the possibility that Romney got busted for evasion but subsequently made the government whole by paying full taxes and penalties. I’m happy to hear how I may be wrong. (FWIW I strongly expect Reid owes Romney an apology and/or a name.)

  • Pupienus

    You miss the point of his keeping the returns sekrit. Even if the average number is true real factual and correct, there are unanswered questions. The devil, as they say, is in the details. What was he doing exactly with those Cayman accounts? Did he take the amnesty on Swiss accounts? Did he list his residence accurately as California when he voted in Mass.? Et fucking cetera.

    • Cody

      I’d just like to point out – although this is unlikely – if he got caught in voter fraud it would be a good laugh.

      Though other Republican got caught committing voter fraud out of ignorance, and they don’t see the irony with them being all worried about Democrats doing it.

  • The letter from PWC is a brilliant piece of work, designed to create headlines that lull low-information voters but not actually inform.

    I particularly like the part where the “effective federal personal income tax rate” and “effective state personal income tax rate” and “effective charitable contribution rates” don’t add up: 20.20%, 8.36%, and 13.45% (3/4ths of which is, presumably, tithing), but the “Total” line is “38.49% of your adjusted gross income for the period.”

  • Eli wants to see the long form

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