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#232299 - 08/07/12 12:44 PM Re: Reid: Mitt Romney didnít pay taxes for 10 yeara [Re: Schlack]
NW Ponderer Offline
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Registered: 09/09/11
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I just read an analysis that explained how Romney probably paid little to no taxes in 2008-9. My notebook crashed so I don't have the link right now, but the gist is based upon his 2010 return where he "carried over" losses from previous years, which means his deductions for at least 2009 exceeded his reported income (since it was all capital gains) thus, no taxes on that income...he may have had some dividend and interest income, so paid some taxes, but less than an average wage earner likely paid. This is not rank speculation, but based upon analysis of his current returns.
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A well reasoned argument is like a diamond: impervious to corruption and crystal clear - and infinitely rarer.

Here, as elsewhere, people are outraged at what feels like a rigged game -- an economy that won't respond, a democracy that won't listen, and a financial sector that holds all the cards. - Robert Reich

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#232302 - 08/07/12 12:59 PM Re: Reid: Mitt Romney didnít pay taxes for 10 yeara [Re: NW Ponderer]
california rick Offline
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Registered: 05/09/05
Posts: 35470
Loc: Bay Area, California
Originally Posted By: NW Ponderer
...but less than an average wage earner likely paid.

Even at 15% which is the regular effective rate for taxes on capital gains - that rate is below us every day laborers who pay 34%.

This rich man effective tax rate coupled with the fact that it costs nearly $50K annually to own a fancy, prancing horse - tells us that Mr. Romney is unable relate to us every day plain folk and I suspect will be working for the 1-5% if elected - not all of us Americans.
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#232306 - 08/07/12 01:17 PM Re: Reid: Mitt Romney didnít pay taxes for 10 yeara [Re: NW Ponderer]
Siannan Offline
journeyman

Registered: 08/07/04
Posts: 809
Loc: New Jersey Pine Barrens
Originally Posted By: NW Ponderer
I just read an analysis that explained how Romney probably paid little to no taxes in 2008-9. My notebook crashed so I don't have the link right now, but the gist is based upon his 2010 return where he "carried over" losses from previous years, which means his deductions for at least 2009 exceeded his reported income (since it was all capital gains) thus, no taxes on that income...he may have had some dividend and interest income, so paid some taxes, but less than an average wage earner likely paid. This is not rank speculation, but based upon analysis of his current returns.


As a tax person, this could be accurate. Which would explain why Mitt is refusing to release his tax returns. And also why McCain selected the Alaskan Airhead over Mitt in 2008. Hmmm?
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#232311 - 08/07/12 01:37 PM Re: Reid: Mitt Romney didnít pay taxes for 10 yeara [Re: Ted Remington]
Lillibet Offline
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Registered: 12/19/05
Posts: 2262
Loc: Chicago, Illinois
Hasn't Romney been running since 2004? He stepped it up for 2008, but I thought he was entertaining a shot at the WH even in 2004, so he'd be perfectly positioned to run in 2008.

If he didn't pay taxes because he just couldn't help himself from taking advantages of loopholes, then it would seem he's done a Grover Norquist, doubled down and fancied up. Norquist wants to starve government or drown in it a bathtub of debt, so that no government services are provided, perhaps excepting war spending.

Most Americans couldn't afford the legal help to get qualified for the loopholes. And, I highly doubt many would even consider many of the convoluted stretches required to qualify for the deductions.

If he's also stiffing the LDS Church, I'm sure they're lining up to pardon him, because even an 8 percent payment would eclipse most other contributors, and anyway, they don't discuss these things in public. So, no flogging of Mormon miscreants of Romney's class/type/stature are likely. They might flog the lower classes that fail to make a 10% on a $10,000 income, but never on the greatest and goodest. That is, as opposed to the merely great and good.

If this non-payment is true, then Romney has demonstrated by his deeds what is, in fact, a true love of money. And we know what that particular love grows best.
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#232314 - 08/07/12 01:47 PM Re: Reid: Mitt Romney didnít pay taxes for 10 yeara [Re: logtroll]
Lillibet Offline
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Registered: 12/19/05
Posts: 2262
Loc: Chicago, Illinois
Originally Posted By: logtroll
Candidate Romney sticks it to other countries, too...

Romney not welcome in Italy
Remember, Italy is the country from which we learned the true operation of the term 'vendetta' and we owe the Medici's much for proper application of the vendetta related revenge, so often seen in political and other intrigue.

The Prince was written largely about Italian ruling principles, or desired ones.

Of course, the Italians also brought us the happier ideas behind pizza, ravioli and those lovely stuffed pasta packets based on the ever beautiful Venus, on or off the half shell.

The article though, shows the Italians do not have a short memory when it comes to tax avoidance or other damages connected to the "I like firing people" fellow that wants to set up shop in an oddly shaped office in DC.
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#232322 - 08/07/12 04:52 PM Re: Reid: Mitt Romney didnít pay taxes for 10 yeara [Re: california rick]
keysersoze Offline
journeyman

Registered: 12/01/11
Posts: 862
Originally Posted By: california rick
Originally Posted By: NW Ponderer
...but less than an average wage earner likely paid.

Even at 15% which is the regular effective rate for taxes on capital gains - that rate is below us every day laborers who pay 34%.

This rich man effective tax rate coupled with the fact that it costs nearly $50K annually to own a fancy, prancing horse - tells us that Mr. Romney is unable relate to us every day plain folk and I suspect will be working for the 1-5% if elected - not all of us Americans.


I have no issue with the horsey since that is originally a therapeutic animal. My daughter does the same with Golden Doodles. Now I wonder if horsey appears as a write off? Now that would be interesting.

Romney paid at almost 15% from what I read. I paid less despite being a 5 percenter. All depends on your income streams and deductions. I'd love to see his gross income and then the AGI.
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#232326 - 08/07/12 05:34 PM Re: Reid: Mitt Romney didnít pay taxes for 10 yeara [Re: california rick]
pondering_it_all Offline
old hand

Registered: 02/27/06
Posts: 4192
Loc: North San Diego County
Quote:
that rate is below us every day laborers who pay 34%.


If you are paying 34%, you need a new tax accountant! Or your idea of "every day laborer" is a guy pulling in $200,000/year.

Look at Schedule X on the last page of the tax tables here:
Tax Tables for 2011

On your first $8,500 you pay 10%.
On the next $26,000 you pay 15%.
On the next $49,100 you pay 25%.
On the next $90,800 you pay 28%.

If you are making more than $174,400 I would hardly call you an every day laborer!

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#232327 - 08/07/12 05:35 PM Re: Reid: Mitt Romney didnít pay taxes for 10 yeara [Re: NW Ponderer]
rporter314 Offline
old hand

Registered: 03/18/03
Posts: 4750
Loc: Highlands, Tx
Quote:
he "carried over" losses from previous years, which means his deductions for at least 2009 exceeded his reported income (since it was all capital gains) thus, no taxes on that income

from tax code we have the following

"If your capital losses exceed your capital gains, the amount of the excess loss that can be claimed is the lesser of $3,000, ($1,500 if you are married filing separately) or your total net loss as shown on line 16 of the Form 1040 Schedule D, Capital Gains and Losses. If your net capital loss is more than this limit, you can carry the loss forward to later years."

note the "lesser" ... so based on what you said he would have had to have had a capital gain of less than $3k which was offset by previous capital losses. I don;t see how he had an income that small and still been a zillionaire

i think you are on the right track but in the wrong place ... suppose all his income was "earned" overseas for which he paid foreign taxes which exceeded his US tax liability a la Exxon

people who make money in all kinds of exotic ways have very complex returns for which the tax code may not address clever schemes to avoid tax liability.
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#232346 - 08/07/12 07:24 PM Re: Reid: Mitt Romney didnít pay taxes for 10 yeara [Re: rporter314]
NW Ponderer Offline
Moderator
veteran

Registered: 09/09/11
Posts: 11333
I think friend Rick was including all taxes, not just income tax, when he came up with the 34% figure. I include payroll taxes (4.2% OASDI FICA (normally 6.2%); plus 6.2% employer contribution - since pay is reduced to accommodate that increment; plus 1.45% Medicare... a self employed individual pays 15.3% (less 2%)). When you add that to the 20-25% rate of an average worker, you get up to the 34% - marginal, no effective, tax rate.

rp, let me clarify how I see the Capital Gains offset/manipulation as I see it, and as it was explained in Here's How Mitt Romney Might Have Paid No Taxes - U.S. News & World Report - the link I promised earlier:
Quote:
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.

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."


Here's an Example:
Investor R buys shares in Company A and Company B at $50.00/share. Company A's value has dropped to $25.00/share, and he anticipates it dropping further. Company B, however, is doing great, and has a significant rise in value (say, $100.00/share). Investor R wants to lock in the value of Company B, but doesn't want to show too much gain for tax purposes. He sells enough shares of Company A at a loss to cover the "gain" from Company B, which he then repurchases at the higher value, thus "banking" the gain, and offsetting it against a "loss" - thus not having a tax liability. Ultimately he still has the shares of Company B, but now his "basis level" is $100/share. Yes, he had a loss, but he prevented a further loss if Company A fell further. The beauty of making all your money from Capital Gains is that you can time your sales to get maximum tax advantage.

It is also a great way to pump up the value of your IRA. You put "stocks" with a low "par value" - which, because you own the whole company, you can value at whatever you want, say $1/share - into your IRA. Then, when you take the company public, through an IPO, and the stock value is legitimately valued at $100/share, the entire $99 gain is protected from taxation because it is in the IRA. You won't pay taxes until you draw out money from the IRA after you retire. And, if you were still holding onto it when you die, the basis will be reset at the value of the time of your death. If Romney has his way, those gains will never be taxed, because he wants to eliminate the Estate Tax.


Edited by NW Ponderer (08/07/12 07:40 PM)
Edit Reason: premature post
_________________________
A well reasoned argument is like a diamond: impervious to corruption and crystal clear - and infinitely rarer.

Here, as elsewhere, people are outraged at what feels like a rigged game -- an economy that won't respond, a democracy that won't listen, and a financial sector that holds all the cards. - Robert Reich

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#232347 - 08/07/12 08:39 PM Re: Reid: Mitt Romney didnít pay taxes for 10 yeara [Re: Schlack]
keysersoze Offline
journeyman

Registered: 12/01/11
Posts: 862
There is the traditional IRA and the Roth IRA. The Roth is not exposed to taxes and the traditional is. Within the traditional IRA any losses cannot be deducted as they would in a regular investment account. Many folks got toasted in their IRA's with that minor blip a few years back. Imagine suffering a 30% loss and then being forced into mandatory withdrawals at age 70 and 1/2. There was a huge disservice down to retirees who got hammered in a down market. With a Roth any earnings are all non taxable.

Of course there are contribution limitations so Romney would have neither with his income.

A capital loss is still a loss. You can cover the gain with a loss but if you have significant gains the loss deduction is minimal unless you have had some real dogs out there. You have that you better get a CD or a new investment adviser.

Then you get into the real way to handle money once you get over 500K (or even under) and that is a trust.


Edited by keysersoze (08/07/12 08:56 PM)
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