Yes, he's rich. Mitt Romney finally releases his tax returns.
After months of pressure, Mitt Romney has released more tax information, which confirms that the Romneys are rich. But he'd probably be a billionaire if he hadn't gone into public service.
Mitt Romney’s personal income-tax records confirm the obvious: He is a wealthy man – part of what Occupy Wall Street calls the “1 percent” and definitely not part of the “47 percent” of Americans that the Republican presidential challenger labeled as “dependent upon government” because they don’t pay income taxes.
After months of being hammered over what many critics saw as his relatively low tax rate, plus having many of his investments tax-sheltered in offshore accounts, Mr. Romney released more tax data Friday. It’s not as much information as he demanded of running mate Rep. Paul Ryan – or as much as Romney himself provided to Sen. John McCain when he was being considered as a vice-presidential candidate in 2008. But it’s more than had been publicly known until now.
R. Bradford Malt, a partner at Ropes & Gray and trustee of the Romneys’ blind trust since 2003, released the couple’s 2011 tax returns, plus a summary of tax rates from tax returns for the years 1990-2009.
Here are the most relevant numbers from Mr. Malt:
• In 2011, Mitt and Ann Romney paid $1,935,708 in taxes on $13,696,951 in mostly investment income.
• The Romneys’ effective tax rate for 2011 was 14.1 percent.
• The Romneys donated $4,020,772 to charity in 2011, amounting to nearly 30 percent of their income.
• The Romneys claimed less than that – $2.25 million of those charitable contributions.
• The Romneys thus limited their deduction of charitable contributions to conform to Romney’s statement in August, based upon the January estimate of income, that he paid at least 13 percent in income taxes in each of the past 10 years.
“As with the 2010 tax return, the 2011 tax return will appear as four separate documents,” Malt explained in notes to his report. “It includes Governor and Mrs. Romney's Form 1040 as well as three underlying Massachusetts trusts detailing the sources of their income. Those are The W. Mitt Romney Blind Trust, The Ann D. Romney Blind Trust, and The Romney Family Trust.”
“The investments within the trusts are managed on a blind basis by me, the trustee,” Malt wrote. “I have sole responsibility for making, holding and disposing of the investments.”
Over the summer, as pressure built on Romney to release more of his tax returns (beyond the 2010 return he’d already made public), Senate majority leader Harry Reid made what turned out to be a wildly unsubstantiated charge that Romney had paid no taxes for 10 years. Still, many prominent Republicans urged Romney to release more tax information.
That he’s now done.
The Romneys' tax returns were prepared by PriceWaterhouseCoopers (PWC).
For the 20-year period from 1990 to 2009, PWC reported, the Romneys owed both state and federal income taxes every year.
Over the entire 20-year period, the average annual effective federal tax rate was 20.20 percent, and the lowest annual effective federal personal tax rate was 13.66 percent.
Also over the 1990-2009 period, the Romneys gave to charity an average of 13.45 percent of their adjusted gross income. The total federal and state taxes owed, plus the total charitable donations deducted, represented 38.49 percent of the Romneys' total adjusted gross income.
Romney’s estimated net worth of $250 million may put him in rarefied economic air. But his personal and professional decisions in recent years in fact mean he missed out on joining the billionaires’ club, Bloomberg News reported this week.
“While private-equity peers Stephen Schwarzman, Henry Kravis and David Bonderman have each accrued a 10-figure net worth, the Republican presidential nominee missed out on his industry’s most lucrative era, a decade when he managed the Winter Olympics, served as governor of Massachusetts and ran for president,” Bloomberg reported Thursday. “Had he stayed at Bain Capital LLC, he’d be worth more than $1 billion, according to the Bloomberg Billionaires Index.”
As the tax information was being released Friday, Romney’s presidential campaign tried to put it in a light that might help dispel any impression that his wealth puts him out of touch with most Americans.
“First, as a successful businessman, Governor Romney has not only added value to our economy through his investment and business activity, but he has paid millions in taxes every year to the US government,” according to the campaign statement. “Second, the Romneys take to heart ‘to whom much is given, of him shall much be required.’ Accordingly, they have been generous in their charitable giving, donating over $7 million between 2010-2011 – donating more to charity than they paid in federal income taxes.
"Third, Mitt Romney has scrupulously complied with the US tax code, and his income is reported and taxed at the applicable rates, and he has paid 100 percent of what he has owed.”
“And not a penny more,” as he has previously said.