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Romney intentionally overpays taxes, disqualifies himself from White House?

September 21, 2012

In July when Mitt Romney was catching heat for paying a 2010 personal income tax rate of only 13.8 percent, he defended his filing tactics by saying that if he paid more taxes than were required, he wouldn't be qualified to be president.

Uh, Mitt. You might want to rethink that statement.

Romney today released his 2011 tax return. A note accompanying the 379-page filing pointed out that the Republican presidential candidate intentionally overpaid last year's taxes.

Romney 2011 return_Twitter_@JECarter4

Mitt and Ann are sending the U.S. Treasury more money than they had to because they decided not to claim some charitable deductions.

Brad Malt, a partner at Ropes & Gray, LLP, and trustee of the Romneys' blind trust, explained:

"The Romneys' generous charitable donations in 2011 would have significantly reduced their tax obligation for the year. The Romneys thus limited their deduction of charitable contributions to conform to the Governor's statement in August, based upon the January estimate of income, that he paid at least 13% in income taxes in each of the last 10 years."

Of course, cynics among us (where?! where?!) might say the move was motivated by Romney's secretly taped remarks about the 47 percent of Americans who didn't pay federal income taxes in 2011.

What the Romneys gave, paid: Even after erasing millions in charitable donations from their Schedule A, the GOP presidential nominee and his wife still claimed an itemized charitable deduction of $2.25 million, or about 56 percent of what they actually donated last year.

When all the numbers were run, the Romneys paid a 2011 tax bill of $1.94 million on adjusted gross income of $13.7 million.

Most of the Romneys' income came from investment earnings, which generally are taxed at lower rates than ordinary, or wage, income.

And all these calculations come to a 2011 effective tax rate for the Romneys of 14.1 percent.

In addition to the Romneys' 2011 joint filing, the couple (campaign) also today made public their complete 2010 tax return and a letter from the Romneys' tax preparer, PricewaterhouseCoopers, LLP,
which gives an overview of the Romneys' tax returns from 1990 through 2009.

Twitterverse reactions: I was at a conference when I learned about the Romney 2011 tax return via a Twitter blurb, quickly followed by the hubby's text message alerting me of the day's hottest tax news (he's the best!). 

In addition to James Carter's facetious observation at the top of this post about how Romney might have doomed his White House hopes, several other social media folks had some smart-ass, funny, biting, insightful or insert your own adjective responses to Romney's release of his tax data.

Below are some of my favorites. Feel free to leave links to others that you like in the comments.


Romney 2011 return_Twitter_@chucktodd As a former newspaper reporter, I share NBC's chief White House correspondent's thanks that this didn't get buried later in the day.


Romney 2011 return_Twitter_@williamalden  In an effort to quiet critics who want to see at least 10 years of Romney returns, the former Massachusetts governor has maintained that he's always paid a tax rate of at least 13 percent. We still want to see the forms, not a synopsis.


 
Romney 2011 return_Twitter_@felixsalmonApparently Felix had the same problem that many folks did in trying to access Romney's return immediately after it was released.


Romney 2011 return_Twitter_@craig_crawfordThe Washington, D.C., pundit always has a fun take on political goings-on.


Romney 2011 return_Twitter_@johncook_@felixsalmon Interesting exchange. And yes, there will be continued speculation about Romney's tax filing practices us, before and after Nov. 6.


 
Romney 2011 return_Twitter_@indecisionJon Stewart. Comedy Central. 'Nuff said.


Extension reminder: While Mitt and Ann got their 2011 return in 24 days early, if you also got an extension to file, you still have until Oct. 15 to finish your tax forms and get them to the Internal Revenue Service.

You also might find these items of interest:

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The More Tax Posts tab at the top of this page will take you to, well, more tax posts. You also can search below for a tax topic. 

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TAX-SAVVY WAYS 
TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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