Tag Archives: tax avoidance

Mitt Romney scored huge tax benefits in 2010 using an “active” status at Bain Capital

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DID YOU KNOW that while Mitt Romney tells us he isn’t involved with Bain Capital and his ‘blind trust’ investments there, he tells the IRS that he’s an active participant. Why? Because you get more money from the IRS with an active, rather than passive, investment status:

The distinction is valuable, for the IRS treats passive and active income and losses differently. If a passive investment loses money, the taxpayer can only write off that loss if passive gains have also been made. But active losses can be written off at a 35 percent rate and deducted from the taxpayer’s ordinary income. In other words, a taxpayer wants active losses, not passive losses. So by describing many of his investments as active, Romney saves himself millions of dollars in taxes.

With those active investments, he is also securing a tax break few Americans enjoy: When he wins, he’s paying a 15 percent rate on the gain. When he loses, he’s writing it off at 35 percent, meaning that tax policy is subsidizing Romney’s risk in his Bain investments.

In other words, Romney didn’t build that, at least not without taxpayer backing.

So while Romney tells us he retroactively retired from Bain in 1999 (to avoid criticism about layoffs and other controversies) – and as Huffington Post notes when “tax experts charged that he benefited from legally dubious tax avoidance strategies employed by Bain, his campaign noted that the investments are kept in a blind trust completely out of his control” — we now learn that as recently as 2010 he was telling the IRS that he was actively involved so that he can grab the better tax rates on investment wins and losses.

That doesn’t sound like a retirement or a “blind” trust. Unbelievably, this man will be nominated as the GOP’s presidential candidate this week, and you have to ask: who is he lying to — the American public or the IRS?

And where are the rest of his tax returns?

For the 0.01%, tax has been halved and income has doubled since 1960, due to policy alone

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You don’t think that’s fair? Get over it.

Paul Krugman points out that “tax cuts are a much bigger story in rising inequality than the right wants to hear. Piketty and Saez (pdf) have looked at tax rates including imputed corporate taxes, and here’s what they get:

“Tax rates for the super-elite, the top .01%, have fallen in half since Mitt Romney’s father ran for president; or to put it differently, after tax income for this group has doubled due to policy alone. And bear in mind that the US economy flourished just fine under those 60-70 tax rates …”

Mitt Romney is one of the super-elites, with the low tax rates and doubled take-home income — and he wants to be president.

Zack Beauchamp from Think Progress observes: ”…Sen. Lindsey Graham’s (R-SC) attempt to defuse the controversy surrounding Romney’s taxes may be a new low for the campaign: Mitt Romney shouldn’t be criticized for using off-shore tax havens because “it’s really American to avoid paying taxes, legally.”  [...] A recent report by the California Public Interest Research Group (CALPIRG) found that tax dodging shifts $100 billion onto taxpaying Americans.”

Romney’s response? “Mitt Romney said on Monday that his offshore investments were managed by a blind trust and he had no knowledge of their whereabouts. “I don’t manage them. I don’t even know where they are. That trustee follows all U.S. laws. All the taxes are paid, as appropriate. All of them have been reported to the government. There’s nothing hidden there. If, for instance, you own shares in Renault or Fiat, you still have to disclose that in the United States.”"

image: con-tem-plate

Romney’s campaign is working under an ideology of “what you don’t know can’t hurt me.” And teabaggers are only too happy to work under that ideology with him. But imagine the outrageous outrage, the far-right media spin, and the impeachment charges if President Obama had any amount of money in offshore accounts or wouldn’t release but one year of his tax returns. These folks have such a hypocritical set of double-standards, it’s not even funny.

More undisclosed offshore money: Romney’s even wealthier than previously reported

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You don’t get to know how much Mitt Romney is worth — or where he keeps his money. Via Political Wire: “Mitt Romney’s investment portfolio “has included an offshore company that remained invisible to voters as his political star rose,” the AP reports.”

“Based in Bermuda, Sankaty High Yield Asset Investors Ltd. was not listed on any of Romney’s state or federal financial reports. The company is among several Romney holdings that have not been fully disclosed, including one that recently posted a $1.9 million earning — suggesting he could be wealthier than the nearly $250 million estimated by his campaign.”

“The omissions were permitted by state and federal authorities overseeing Romney’s ethics filings… But Romney’s limited disclosures deprive the public of an accurate depiction of his wealth and a clear understanding of how his assets are handled and taxed.”

original image via: christopherstreet

This is how the wealthiest become even wealthier: earn money in America, offshore it to other countries to avoid taxes. THAT’S HOW AMERICA WORKS!

Investigation: Mitt Romney’s Offshore Accounts, Tax Loopholes, and Mysterious I.R.A. | Vanity Fair – “For all Mitt Romney’s touting of his business record, when it comes to his own money the Republican nominee is remarkably shy about disclosing numbers and investments. Nicholas Shaxson delves into the murky world of offshore finance, revealing loopholes that allow the very wealthy to skirt tax laws, and investigating just how much of Romney’s fortune (with $30 million in Bain Capital funds in the Cayman Islands alone?) looks pretty strange for a presidential candidate.”