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Here's How Mitt Romney Might Have Paid No Taxes
Here's How Mitt Romney Might Have Paid No Taxes
Rick Newman
<...>
If Romney has paid taxes, as he insists, he could clear up the whole controversy by simply releasing several years' worth of tax returns, beyond the 2010 return and the 2011 estimate he's already released. But he has refused, and there may be good reason for that. "I wouldn't be surprised if he paid nearly zero taxes in 2008 and 2009," says Brad Badertscher, an accounting professor at the University of Notre Dame. "It's going to look bad no matter what he does."
Theories about Romney's tax strategy tend to focus on offshore investment vehicles and secretive accounts, but basic investing and accounting scenarios could easily explain a low tax bill. The clue comes in Schedule D of his 2010 return, in which he claimed a $4.8 million loss carried over from prior years. That helped reduce his tax bill for 2010, in which he paid $3 million in taxes on $21.7 million of income, for an effective tax rate of 13.9 percent.
[See the Romney and Obama fantasy tax plans.]The carryover means that Romney probably claimed a much bigger loss a year or two earlier, which could easily have pushed his tax rate for 2008 or 2009 down to the low single digits. Most investors lost money in 2008, the year that Lehman Brothers collapsed and the S&P 500 stock index fell by 37 percent. Romney was probably no different.
During bad years, wealthy investors often use a legal strategy called "tax harvesting" in which they sell weak investments at a loss, which they can use to offset the tax they'd need to pay on gains from better-performing investments. The loss can be carried forward, to help lower the tax bill in later years when investments might have done better. "It's very common for sophisticated investors," says Badertscher. "It's a good time to clean out your portfolio, sell the losers, and use the losses for tax purposes." Romney has said that his investments are in a blind trust, so if his advisors made such moves, they may have done so without his input.
- more -
http://www.usnews.com/news/blogs/rick-newman/2012/08/07/heres-how-mitt-romney-might-have-paid-no-taxes
Rick Newman
<...>
If Romney has paid taxes, as he insists, he could clear up the whole controversy by simply releasing several years' worth of tax returns, beyond the 2010 return and the 2011 estimate he's already released. But he has refused, and there may be good reason for that. "I wouldn't be surprised if he paid nearly zero taxes in 2008 and 2009," says Brad Badertscher, an accounting professor at the University of Notre Dame. "It's going to look bad no matter what he does."
Theories about Romney's tax strategy tend to focus on offshore investment vehicles and secretive accounts, but basic investing and accounting scenarios could easily explain a low tax bill. The clue comes in Schedule D of his 2010 return, in which he claimed a $4.8 million loss carried over from prior years. That helped reduce his tax bill for 2010, in which he paid $3 million in taxes on $21.7 million of income, for an effective tax rate of 13.9 percent.
[See the Romney and Obama fantasy tax plans.]The carryover means that Romney probably claimed a much bigger loss a year or two earlier, which could easily have pushed his tax rate for 2008 or 2009 down to the low single digits. Most investors lost money in 2008, the year that Lehman Brothers collapsed and the S&P 500 stock index fell by 37 percent. Romney was probably no different.
During bad years, wealthy investors often use a legal strategy called "tax harvesting" in which they sell weak investments at a loss, which they can use to offset the tax they'd need to pay on gains from better-performing investments. The loss can be carried forward, to help lower the tax bill in later years when investments might have done better. "It's very common for sophisticated investors," says Badertscher. "It's a good time to clean out your portfolio, sell the losers, and use the losses for tax purposes." Romney has said that his investments are in a blind trust, so if his advisors made such moves, they may have done so without his input.
- more -
http://www.usnews.com/news/blogs/rick-newman/2012/08/07/heres-how-mitt-romney-might-have-paid-no-taxes
So Harry Reid could be right?
Romney lied to GOP about his investments
http://www.democraticunderground.com/10021081574
The point is that Romney's returns will be revealing.
http://www.democraticunderground.com/10021065191
Mitt is trapped.
http://www.democraticunderground.com/10021073742
Oh, it looks like Dana Bash updated the angle of her piece from yesterday: http://www.democraticunderground.com/10021082932
Today:
Reid puts Romney in a bind over taxes
By Dana Bash, CNN Senior Congressional Correspondent
Washington (CNN) -- Republican sources say they're in a Catch-22 situation on how to reply to Senate Majority Leader Harry Reid's claims that GOP presidential candidate Mitt Romney went 10 years without paying taxes.
They understand that they're taking Reid's bait and that responding to his unsubstantiated claims against Romney keeps alive the issue of Romney's refusing to release his tax returns.
Still, these GOP sources say they feel that if they do not respond to such a serious charge from such a high-ranking Democrat, it will look like a tacit admission Reid is right.
Republicans stepped up attempts to undermine Reid's unsubstantiated allegations Monday, saying Reid and other Democrats' accusations are being orchestrated by President Barack Obama's campaign -- specifically his senior campaign adviser, David Axelrod.
- more -
http://www.cnn.com/2012/08/07/politics/reid-romney-taxes/index.html
By Dana Bash, CNN Senior Congressional Correspondent
Washington (CNN) -- Republican sources say they're in a Catch-22 situation on how to reply to Senate Majority Leader Harry Reid's claims that GOP presidential candidate Mitt Romney went 10 years without paying taxes.
They understand that they're taking Reid's bait and that responding to his unsubstantiated claims against Romney keeps alive the issue of Romney's refusing to release his tax returns.
Still, these GOP sources say they feel that if they do not respond to such a serious charge from such a high-ranking Democrat, it will look like a tacit admission Reid is right.
Republicans stepped up attempts to undermine Reid's unsubstantiated allegations Monday, saying Reid and other Democrats' accusations are being orchestrated by President Barack Obama's campaign -- specifically his senior campaign adviser, David Axelrod.
- more -
http://www.cnn.com/2012/08/07/politics/reid-romney-taxes/index.html
"Bind"? Understatement!
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