Romney trusts receive more from govt for 2011 than Romney is paying in income tax
What was that about receiving money from the government, again?
Re-posting from Saturday, responding to a couple of quick questions and further clarifying the earlier post–
Friday p.m., Sept. 21, Mitt Romney finally released his completed tax return for 2011. Finished Monday, released Friday afternoon, in one of those document drops traditionally timed for the start of the weekend rather than for the top of the news cycle.
The filing is dated Sept. 17, 2012, right after–first business day after–public release by Mother Jones magazine of Romney’s videotaped remarks. The three blind trust filings, however, were signed Sept. 12. Safe to say the Romney team waited until after the conventions to finish the tax papers, but the timing of the release may well have been planned before the Mother Jones videotape.
Mitt Romney
For now, a quick note on the Romney trusts.
First, the W. Mitt Romney Blind Trust return for 2011 shows income for Romney’s blind trust of $664,045 from the U.S. government. Top line, after you get through the pages for extensions, etc., is income from
U.S. GOVERNMENT INTEREST: $652,018.
Shortly after that comes U.S. GOVERNMENT INTEREST REPORTED AS DIVIDENDS: $12,027.
Total for 2011: as stated $664,045.
This is interest income alone in 2011, for Romney’s blind trust, from the United States government.
U.S. savings bonds
The same story holds for the other Romney trusts.
The 2011 return for the Romney Family Trust shows
U.S. government interest income: $662,115.
U.S. government interest in dividend form: $90,461.
Total U.S. government interest income for the Romney family trust: $752,576.
The 2011 return for the Ann Romney Trust shows
U.S. government interest income: $362,701.
U.S. government interest reported as dividends: $156,157.
Total: $518,858.
So total moneys received as interest, from our U.S. government in 2011, by the Romney trusts, came to $1,935,479.
A snarky person might call that the exact amount–in this category, for 2011–added by Romney trusts to the ‘national debt’ our GOPers gripe about so much.
I don’t feel that way, of course. I favor buying U.S. savings bonds. A few qualifiers, here:
One, as written previously I support buying U.S. Treasury notes, bills, and savings bonds. With interest rates low, it is a particularly patriotic thing to do, and that so many people and business entities around the globe are doing so is further evidence of the solidity of the U.S. government. Low-yielding savings bonds are a fiscally conservative form of investment and a safe place to park money.
Romney’s tax returns do not indicate when Romney or his trusts purchased the Treasury products producing this trust interest income.
Two, this interest income, handsome as it is, is dwarfed by the myriad tax write-offs allowed by our government to entities like Romney’s trusts, by the pages of paper losses and deductions Romney can legally use to reduce his taxes, and above all by the lower federal tax rate applied to income gotten by capital gains rather than by working.
But wait, there’s more. The next Q is how the blind trust returns relate to Romney’s tax return.
The Romneys’ tax return shows total adjusted gross income: $13,696,951.
Largest single income source: capital gains: $6,810,176.
Next largest income source: dividends: $3,649,567.
Next largest income source: interest: $3,012,775.
One answer is that the Romneys’ federal interest income comes to one-seventh, or 14 percent, of the adjusted gross income declared on Romney’s IRS return for 2011. Much has been made of that percentage in the 2012 election campaign, as we recall. Saturday’s Washington Post headline on this topic said that Romney paid a 14 percent tax rate in 2011. The WP did not mention that Romney’s income tax burden was almost exactly offset by interest income the Romney trusts received from the U.S. Treasury.
Looking at the same thing another way, without the interest income from Treasury, the Romneys’ adjusted gross comes down to $11,239,472. Admittedly that total would still be enough for their simple needs.
It might also be noted, though, that the income reported is just the interest on those U.S. government products. The face value of the Treasury bonds, notes or bills does not have to be reported, and isn’t. Nor is the purchase date or the type of Treasury product purchased. It’s just money coming back into Romney accounts–the full maturity value of the EE-Series bonds or whatever, which would be a multiple of the reported interest income.
Moving from percentages to dollar amounts, Romney reports owing $1,935,708.00 in federal income tax for 2011. He reports paying $3,434,441. That’s an overpayment with refund due to Romney, according to his return, of $1,498,740. (Box checked applying it to estimated tax for 2012.)
Thus,
to the government: $1,935,708.00
from the government: $1,935,479.00
Difference: $229.00
In short, by some uncanny coincidence Romney’s combined trusts received in interest FROM Uncle Sam, for 2011, almost exactly what citizen Romney is paying in income tax TO Uncle Sam for 2011.
And as stated that’s before factoring in all the offsets, credits, deductions and other means of reducing reportable or taxable income on the family IRS returns.
Romney’s releases re finance are posted here.