Posts Tagged ‘Philip Klein’

Mitt’s 203-page tax return

Tuesday, January 24th, 2012 by Joe Kristan

There’s a lot to the Mitt Romney 2010 1040. 203 pages long, with over $20 million of adjusted gross income, it tells a story of a wealthy and sophisticated investor. The would-be GOP nominee also released some trust returns that feed into the 1040. There’s a lot here, and far more than I should spend unpaid time thinking about — but I can’t resist a little bit of voyeuristic observation.
– Mitt had a much better 2010 than 2009. His “protective” estimated tax based on 2009 tax was about $1.37 million. He had to pay in another $3.25 million with his extension. Much of that was cushion to cover 2011 estimated tax payments; he had a $1.6 million overpayment on the completed return, all of which went to 2011 estimates.
– 2010 was better because of $16.7 million in capital gains, offset by a $4.8 million capital loss carryover.
– That said, with $3.3 million in interest income and $4.9 million in dividend income, Mitt can hardly have a really bad year.
– The return was signed by somebody at PricewaterhouseCoopers on October 15, at the end of the extension period. Can you imagine the scene if Mitt had pointed out a mistake on the return on the extended due date? I can only imagine the logistical nightmare of making sure the return was signed and filed by the taxpayers on time.
– The return was, of course, prepared on what Robert D. Flach would call “flawed and expensive” tax return software. To do this return by hand, like Robert does his returns, would require a small army of flawed and expensive staff accountants with good penmanship. If nothing else, it shows that the current complexity of the tax law is possible only because of computers.
– Mitt has a $2 million passive loss carryforward, of which over $1 million is attibutable to 2010 losses.
– His return is fraught with potential expensive foot-faults. For example, he has a Form 8865 to report a foreign partnership and a Form 5471 for a controlled foreign corporation. Failure to file either one of these on time would have generated a $10,000 IRS penalty notice.
– The total tax on the 1040 is just over $3 million. If you counted the 35% tax paid by corporations on income generating the $3.3 million in qualified (15%-rate) dividends he reported, it would be about $1.79 million higher.
I’m sure the Obama, Gingrich and Santorum opposition research teams will be forthcoming with much more detailed analysis soon.
Link: Romney campaign page tax return links and campaign overview.
TaxGrrrl, “Romney’s Tax Returns are Remarkably… Unremarkable
The TaxProf has a roundup.
Kay Bell, “Romney Release 2010 tax returns
Philip Klein, “Romney needs no apology on tax returns
Christopher Bergin, “Romney