Tax day at White House: Obama gets big refund. Is that normal?

The IRS owes Barack and Michelle Obama $24,515. The majority of known presidential tax returns have resulted in refunds, with the interesting exception of the year before or after an inauguration.

|
Susan Walsh/AP
President Obama is pictured speaking in the Rose Garden of the White House in Washington on Tuesday.

President Obama released his 2011 tax returns last week, and there’s been lots of scrutiny of his effective tax rate (20.5 percent), whether that’s higher or lower than Mitt Romney’s (higher), what that means for the presidential election, and so forth. But when reading Mr. Obama’s forms on Tuesday in honor of tax day, we noticed something else we found interesting: The US chief executive is getting a humongous refund, by our standards.

That’s right, the Internal Revenue Service owes Barack and Michelle Obama a whopping $24,515. And let’s be honest: Isn’t the state of the refund, or lack thereof, how most of us rate tax day?

When all you have is salary, you get used to your tax payments being withheld, so what really hurts is being forced to write a big check to the government in early April. Conversely, if you're getting cash back, the season suddenly gets all bright and sparkly. As it appears to be in the Obama household.

Yes, we know that it’s better to keep as much of your money as long as possible and that overpaying so as to get a refund isn’t economically optimal. Yes, Obama’s refund is actually a small slice of his family income – only about 3 percent. Spoilsport.

Still, it got us wondering. Is it usual for US presidents to get tax refunds? So we looked it up, via the Tax History Project, which groups the tax returns released by presidents and presidential candidates in one place.

The answer is that the vast majority of known presidential tax returns did indeed result in refunds, with the interesting exception that most recent presidents had to pay the IRS in the year just after or just prior to the start of their terms.

Obama got a $12,334 refund last year and an $8,287 refund the year before that. But in tax year 2007, he got hammered, as he owed the IRS $1,059,826. It was all that book income he earned prior to the election.

George W. Bush owed the IRS in his last year in office, but from 2002 to 2006 he got refunds. In 2003, he got more than $61,451.

In 2001, at the start of his term, Mr. Bush had to pay the man, though not to the extent Obama did. Bush’s April payment that year was only $4,030.

Bill Clinton? All refunds, except for 1992, the year of his election, when he owed $4,085. George H.W. Bush? All refunds, except for 1989, the year after his election, when he owed $3,228.

Same for Ronald Reagan. The only year he had to pay the IRS was 1982, in the middle of his first term, when he coughed up $124,582 for tax day.

There’s a pattern developing here, and if we were suspicious, we’d say that presidential advisers tell new chief executives that it’s better to receive than give, in terms of their taxes. They don’t want to look like they’re not willing to pay their fair share.

Given the size of his finances, Mr. Romney already has good tax advisers, in case you’re wondering. According to the preliminary data he released earlier this year, he’s going to get a refund of about $207,818 for tax year 2011. That would be more than three times larger than any refund check ever sent to an occupant of 1600 Pennsylvania Avenue, since presidents began releasing their personal tax data.

You've read  of  free articles. Subscribe to continue.
Real news can be honest, hopeful, credible, constructive.
What is the Monitor difference? Tackling the tough headlines – with humanity. Listening to sources – with respect. Seeing the story that others are missing by reporting what so often gets overlooked: the values that connect us. That’s Monitor reporting – news that changes how you see the world.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

QR Code to Tax day at White House: Obama gets big refund. Is that normal?
Read this article in
https://www.csmonitor.com/USA/Politics/Decoder/2012/0417/Tax-day-at-White-House-Obama-gets-big-refund.-Is-that-normal
QR Code to Subscription page
Start your subscription today
https://www.csmonitor.com/subscribe