Romney tax return shows he paid $3 million. His tax plan wouldn't bump that.
The wealthy GOP presidential candidate paid about 14 percent of his income in taxes in 2010, the Romney tax return shows. That's a lower rate than most middle-class Americans pay. Under Romney's tax reform plan, his tax bite would not change.
MItt Romney's just-released tax returns – the first he's ever made public – confirm what most Americans already knew: Mr. Romney is very wealthy. Now they can put some numbers to his income: almost $21.7 million in 2010 and some $20.9 million in 2011.Skip to next paragraph
Subscribe Today to the Monitor
This annual income would make Romney, a founder of the private-equity firm Bain Capital, among the elite in terms of his earnings, say tax experts.
“He’s in the top, top tier,” says Roberton Williams of the nonpartisan Tax Policy Center in Washington. “He’s not in the top 400 – you would need $100 million or more [a year] for that, but he’s well up there.”
What differentiates Romney from many other millionaires is that little of his annual income comes from working a 9-to-5 job. Rather, most of it comes from investments, and the tax rate on investments is relatively low. As a result, Romney's tax rate was about 13.9 percent in 2010 and an estimated 15.4 percent in 2011 – lower than the rate paid by most middle-class Americans.
“He’s not paying much tax compared to others in his category,” says Mr. Williams.
Romney also receives tax deductions for charitable giving. He gave almost $3 million in 2010, including $1.5 million to the Mormon church, his tax records show.
Romney’s federal taxes totaled about $3 million in 2010 and an estimated $3.4 million in 2011. His noninvestment income from speaking engagements, royalties, and the like – which are taxed at a higher rate – amounted to $593,996 in 2010 and about $110,500 in 2011.
The Romney campaign, in a conference call with reporters Tuesday morning, was quick to note that the presidential candidate's returns show there was no attempt to hide income or evade taxes.
“Romney paid 100 percent of what he owes,” said Ben Ginsberg of the law firm Patton Boggs, Romney’s national counsel, who said Romney's relatively low tax rate is because capital gains and dividends are taxed at 15 percent and because the former Massachusetts governor gives generously to charities.
“His effective tax rate comes about because of the current US tax rate as contained in the current US tax laws, passed by Congress,” said Mr. Ginsberg.
Indeed, Romney's tax returns illustrate the tax code's complexity. Ann and Mitt Romney’s 2010 tax return runs 203 pages, including schedules and supplemental information from blind trusts, charitable foundations, and foreign bank accounts. Indeed, the campaign’s total release of Romney’s tax filings over two years ran more than 500 pages, including filings from three trusts and a foundation.