Qtec
08-26-2012, 01:29 AM
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body">Mitt Romney Reaped Huge Tax Benefits Based On 'Active' Role At Bain Capital
WASHINGTON -- Mitt Romney has repeatedly insisted during the presidential campaign that layoffs and other controversy surrounding Bain Capital companies for the past decade are not his responsibility, because he retired in 1999. 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.
"As we have said many times before, Governor and Mrs. Romney's assets are managed on a blind basis. They do not control the investment of these assets. The investment decisions are made by a trustee," spokeswoman Michele Davis said.
<u>But according to his 2010 tax return,</u> when the Internal Revenue Service comes calling in April, Romney has a different answer: The presumptive GOP nominee reaps lucrative tax breaks for "active" participation in the private equity firm he founded, as well as a host of other investments.
As David Kautter, a tax expert at American University, explains, the concept of active investment has different meanings for the IRS and for regular people. "When you say you're actively involved in all these businesses, people do think, OK, you're actively involved. But the tax law has its own definition," he said.
That still leaves Romney in a rhetorical jam: For tax purposes, he claims an active status; for political purposes, he claims to have zero to do with the investments.
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 and only at a 15 percent rate. 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.
<span style='font-size: 14pt'>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.</span>
<span style="color: #3333FF">"Governor Romney appears to be saying one thing to the American people and one thing to the Internal Revenue Service,"</span> Rep. Brad Miller (D-N.C.) said to The Huffington Post. "Right now we are just seeing inconsistent statements. The American people are entitled to know more than that. If there's a legalistic distinction, we are entitled to know what that is. ... Has he played too close to the line or over the line? </div></div>
link (http://www.huffingtonpost.com/2012/08/26/romney-bain-taxes_n_1828816.html)
What a guy!
Q
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"> According to the Washington Post, 50 percent of all capital gains in the United States flow to the top 0.1 percent of taxpayers</div></div>
WASHINGTON -- Mitt Romney has repeatedly insisted during the presidential campaign that layoffs and other controversy surrounding Bain Capital companies for the past decade are not his responsibility, because he retired in 1999. 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.
"As we have said many times before, Governor and Mrs. Romney's assets are managed on a blind basis. They do not control the investment of these assets. The investment decisions are made by a trustee," spokeswoman Michele Davis said.
<u>But according to his 2010 tax return,</u> when the Internal Revenue Service comes calling in April, Romney has a different answer: The presumptive GOP nominee reaps lucrative tax breaks for "active" participation in the private equity firm he founded, as well as a host of other investments.
As David Kautter, a tax expert at American University, explains, the concept of active investment has different meanings for the IRS and for regular people. "When you say you're actively involved in all these businesses, people do think, OK, you're actively involved. But the tax law has its own definition," he said.
That still leaves Romney in a rhetorical jam: For tax purposes, he claims an active status; for political purposes, he claims to have zero to do with the investments.
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 and only at a 15 percent rate. 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.
<span style='font-size: 14pt'>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.</span>
<span style="color: #3333FF">"Governor Romney appears to be saying one thing to the American people and one thing to the Internal Revenue Service,"</span> Rep. Brad Miller (D-N.C.) said to The Huffington Post. "Right now we are just seeing inconsistent statements. The American people are entitled to know more than that. If there's a legalistic distinction, we are entitled to know what that is. ... Has he played too close to the line or over the line? </div></div>
link (http://www.huffingtonpost.com/2012/08/26/romney-bain-taxes_n_1828816.html)
What a guy!
Q
<div class="ubbcode-block"><div class="ubbcode-header">Quote:</div><div class="ubbcode-body"> According to the Washington Post, 50 percent of all capital gains in the United States flow to the top 0.1 percent of taxpayers</div></div>