Tax Expert: “Romney Paid 13% in 2009? I Call BS”
Posted by Phoenix Woman on August 17, 2012
From Victor Fleischer, a tax expert whose words Congress heeds:
Romney is claiming that he paid at least 13% in taxes every year. I call bullshit. As discussed here,
Romney had a capital loss carryover in 2010, which means that he
realized so many capital losses in 2009 that he couldn’t use them all to
offset capital gains.
What’s interesting is that Romney’s claim could be literally true but
misleading — which means that Romney is full of bullshit, but not a
dirty liar. Suppose, for the sake of argument, that a wealthy taxpayer
earned $1 million in speaking fees (ordinary income), had a portfolio of
investments that increased in value from $100 million to $150 million,
and realized $10 million in capital gains and $15 million in capital
losses. Net income for tax purposes for the year would be negative, and
the taxpayer would pay close to $350,000 in income tax, and would carry
forward a capital loss of $5 million. This would show up as a high tax
rate – 35% of the $1 million in ordinary income — but doesn’t fairly
reflect his economic income.
Go read the whole thing. It’s quite incisive.
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