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From: Dom <DR...@teikyopost.edu>
Newsgroups: alt.politics.economics,alt.politics,alt.politics.usa,soc.culture.usa,alt.activism
Subject: Tax Professionals Scrutinize Mitt Romney's Returns
Date: Thu, 19 Jul 2012 16:12:09 -0700 (PDT)
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I wonder how Mitt Romanoff pulled this off?

<<Candidates list their assets in broad ranges, so we know Romney's
retirement account is worth somewhere between $21 million and $102
million. Law professor Ed Kleinbard of the University of Southern
California says that's a lot of money considering the most Romney
could ever contribute to the account was $30,000 a year.>>
===================

http://www.npr.org/2012/07/19/157002254/tax-professionals-scrutinize-mitt-romneys-returns

July 19, 2012

President Obama's campaign continues to hammer presumptive Republican
nominee Mitt Romney over the GOP challenger's refusal to release more
of his tax returns. Romney has provided one year's record and promised
a second year's worth of returns. But even some of his fellow
Republicans now say that's not enough.

Obama's campaign launched a new TV ad this week, shining a spotlight
on what is and isn't known about Romney's taxes, asking, "What is Mitt
Romney hiding?"

So far, Romney and his family trusts have released their 2010 tax
returns, which fill hundreds of pages. He got an extension for his
2011 return and has promised to release that as soon as it's ready, no
later than mid-October.

Romney says that should be enough.

"People always want to get more. We're putting out what's required,
plus more," he said last week on CNN. "Those are the two years that
people will have, and that's all that's necessary for people to
understand something about my finances."

Retirement Account

But tax professionals still have plenty of questions. For example, Lee
Sheppard, a contributing editor at the journal Tax Notes, wants to
know how Romney amassed so much money in his tax-deferred retirement
account.

"All we know is really that it's a big number, and we're a little bit
baffled as to how it got so big," Sheppard says.

Candidates list their assets in broad ranges, so we know Romney's
retirement account is worth somewhere between $21 million and $102
million. Law professor Ed Kleinbard of the University of Southern
California says that's a lot of money considering the most Romney
could ever contribute to the account was $30,000 a year.

"Either Gov. Romney is sort of the modern-day equivalent of Jack and
his magic beans, who somehow created a mighty beanstalk, or he took a
very aggressive position with respect to valuing insider stock,"
Kleinbard says.

Kleinbard means that Romney might have loaded up his retirement
account with assets from his private equity firm, Bain Capital, and
assigned artificially low values to those assets in order to get
around the federal contribution limits.

If so, Romney would still have to pay taxes on the real value of the
assets when they're withdrawn from the account. But in the meantime,
the money can grow tax-free. Tax Notes' Sheppard says that's an
advantage most taxpayers don't have.

"If you happen to work for a partnership and your compensation is
arranged this way, you get this very beneficial treatment," Sheppard
says.

Romney's campaign didn't respond to NPR's questions about his
retirement account. But his taxes have been dogging the candidate
since the GOP primary. At an NBC debate in January, Romney argued that
there's nothing wrong with minimizing taxes.

"I pay all the taxes that are legally required and not a dollar more,"
he said. "I don't think you want someone as the candidate for
president who pays more taxes than he owes."

Role At Marriott

Romney was equally aggressive toward taxes in the business world. For
years, he was a director of Marriott International, the hotel company
founded by Willard Marriott. Kleinbard, who worked on Wall Street and
served as chief of staff for Congress' Joint Committee on Taxation,
says Marriott had a reputation.

"Marriott was always a tax shelter promoter's first call," he says.
"Marriott was one of those companies that just loved to buy tax
shelters."

Bloomberg reported this year on one Marriott tax shelter, known as
"Son of BOSS." It involved creating paper losses to offset taxes on
real income. The Internal Revenue Service challenged the shelter, and
Marriott lost in court. Judges called the shelter "fictitious" and a
"scheme," and the company was forced to pay $29 million. Kleinbard
notes that when the shelter was adopted, Romney was the chairman of
Marriott's audit committee.

"It's the job of the chair of the audit committee of Marriott to say,
'Hey, wait a minute, just because we have an opinion from Winkin',
Blinkin' and Nod saying that this is a terribly clever idea, I need to
apply some common sense as opposed to just signing on the bottom
line,' " Kleinbard says.

A statement from Marriott says the company only engages in tax deals
it believes are lawful.

"Marriott only engages in transactions that we believe are in
accordance with the tax code and that we think will create shareholder
value," it said.

Kleinbard sees a pattern for Romney of cutting tax corners. Asked
about his taxes in that NBC debate, Romney sidestepped.

"The real question is not so much my taxes, but the taxes of the
American people," Romney said.

Romney, whose 2010 tax rate was less than 14 percent, says he wants to
overhaul the tax code, which he calls "far too complex," "far too
intrusive" and "far too great."