Reid: Bain Investor Told Me That Mitt Romney 'Didn't Pay Any Taxes For 10 Years'

[Torie]

It really is not possible for Mittens to have paid no taxes like that, unless, as is highly unlikely, he had large operating loss carry forwards, or failed to pay himself and used complex stock option arrangements where the strike price was at market value (also highly unlikely). Reid of course knows about as much about taxes as my long dead pet cat, so his yippings on this, and repeating of the hearsay of someone equally ignorant,  do not surprise me.

[Torie]

It really is not possible for Mittens to have paid no taxes like that, unless, as is highly unlikely, he had large operating loss carry forwards, or failed to pay himself and used complex stock option arrangements where the strike price was at market value (also highly unlikely). Reid of course knows about as much about taxes as my long dead pet cat, so his yippings on this, and repeating of the hearsay of someone equally ignorant,  do not surprise me.

Well, in that case Reid will look really silly when Romney releases his tax returns, won't he?

Yes, hopefully, although it won't embarrass Reid. Nothing Reid says ever embarrasses him. He has no sense of shame.

[Torie]

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How perspicacious of you to be able to peer deep down into my innermost soul, and discern that about me of which I do not even consciously know myself. You should be a therapist!  

By the way, isn't "Mittbot" more euphoniously harmonious than "Romneybot?"

[Torie]

It's not true, and there will be no way of verifying whether or not it is.

Then how do you know it's not true?

Because if 1) He paid literally "no" taxes, he would be in jail and 2) I have a hard time believing he found a way to reduce his tax burden to such a low amount, more or less zero, even with clever mastery of the tax code and all the intricacies within it.

Ergo, you don't know

Do you really want to apply that standard? The oldest line of defense for believing in a flat earth, denying the moon landings occured, or doubting evolution and OMG Climate Change. "If I didn't see it, then it didn't happen." Again, do you really want to use that standard?

You and Hagrid are completely mischaracterizing what I said. I said you don't know whether he paid any taxes because he hasn't released his tax returns. That's a fact. Should I just trust that Romney paid taxes because he says so while he continues to hide his returns. He has something to hide, that much is certain. And don't give me the crap about it being impossible to not pay any taxes. This guys have secret overseas bank accounts for pete's sake!

If Romney has "secret" bank accounts, that would not appear on his tax return, and Mittens would be guilty of criminal tax evasion if the suggestion is that the income he earned was hidden by virtue of parking that income in a foreign bank account. And just what income would that be that he is hiding?  I mean his income was made from Bain deals, and the Bain fee charged to investors plus presumably some participation in after fee profits to the extent made. The investors paid the fee, and the profits earned and distributed.  Where did that money go?  I mean, if you are going to be a tax criminal, you don't want to leave little gaps like that. That makes you a dumb tax criminal, and dumb criminals of the white collar variety tend to be bagged and incarcerated.

[Torie]

You do all know that you must disclose all foreign accounts on your 1040 tax return form don't you?  Do any of you file tax returns?

[Torie]

Romney is now responding to Reid by saying he paid lots of taxes.

The word that's missing is "income."

Romney has surely paid a lot of property taxes on his estates in New Hampshire and on the California coast.

Do you actually think Mittens deliberately avoided the use of the word "income," for the reason that you imply?  Or are you just trying to get a rise out of the Pubs around here for kicks? 

For reasons I have mentioned before, it would be almost impossible for Mittens not to have paid income taxes. Do I need to repeat them again for you?

[Torie]

Romney isn't deceiving anyone in this. He is trying to prevent further deception by the Obama opposition research team, by not providing them with the instrument for such.

So why are his taxes so complicated? Of course this is a great argument for tax simplification as well but Romney should have been paying way more in taxes than he did. That's the problem here, not deception by anyone.

My tax return runs about 50 pages. It takes me about a week to prepare.

[Torie]

Torie, I think it's certainly possible he didn't say "income" on purpose. I don't believe Reid's story but I think it's possible he avoided taxes altogether at least once.

This distinction between paying taxes and paying income taxes is always on my mind because of the common claim by some partisans that the poor don't pay taxes in order to justify income tax cuts.

I agree with your second paragraph completely brittain33, which is why the average tax rate looking at all taxes is lower for those earning 100K to 200K than those earning less than 100K. However, bear in mind that this regressive part of the tax structure is substantially mitigated by the earned income tax credit, food stamps,  etc. Which raises its own problems, because the implicit marginal tax rate when your income bumps up from 20K to say 40K, and you lose the transfer payments, becomes uncomfortably high from a public policy standpoint. It just doesn't "pay" that much to try to move on up, and out of the transfer payment zone. However, to mitigate that, means more transfer payments for those earning more, to slow down the phase out. It is a tough nut to crack.

[Torie]

Oh Brittain33 , chill out a bit. I quite enjoyed the reasonably decorous invective on this thread myself. Granted the ball was not moved anyplace much, but sometimes football plays are fun to watch even if no yardage is gained or lost, just watching the bodies bang into each other.

[Torie]

How do we know if Reid is a liar? Maybe he is right. There is only one way to find out....

It looks like we might find out more about Reid's financial situation before we know more about Romney's.

[Torie]

How do we know if Reid is a liar? Maybe he is right. There is only one way to find out....

It looks like we might find out more about Reid's financial situation before we know more about Romney's.

Why is that?

Folks are confused as to how he got rich while in office. The Pubs are digging into it. Stay tuned.

[Torie]

Once again this isn't about Harry Reid. And also it is quite possible that Romney could have paid less than he did in 2011 through legal means. The fact that Romney continues to refuse to reveal the returns opens him to the charge that there is something there that isn't in his 2010/11 returns, otherwise why not reveal? He is already being hit for the techniques he used to lower his taxes in those years so if it is more of the same then all he can do is benefit by getting rid of the 'what is he hiding?' attack.

It is worth noting that Romney has a history with skating on the edge (and going over the line) with the IRS, at least on the business side. Here is an article from Bloomberg earlier this year

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and there is much more at http://www.bloomberg.com/news/2012-02-22/romney-as-auditing-chairman-saw-marriott-son-of-boss-tax-shelter-defy-irs.html

The tax code in its application in some of these complex tax avoidance transactions, has a grey zone. Just what constitutes a sufficient level of economic substance is not as exact as the speed of light, and sometimes generates litigation that can generate boatloads of attorneys fees. That is one reason why we think the Tax Code is far superior to the Bible. It's a work of art, and we love it.

I probably have billed about a fifth of my lifetime legal fees over tax code disputes, one involving gold swaps done in a Singapore foreign subsidiary, where the subsidiary was enjoying a 10 year tax free holiday in Singapore to induce the oil service firm to build their plant there, and thus was awash in cash (about 100 million or so), which gold swaps were designed to convert interest to something that was not Subpart F income so it would not be subject to tax in the US (we won that one, which caused the Tax Code to be amended to shut it down after the IRS lost). Another involved capital gain recognition or the lack thereof when real estate was taken out of subchapter S corp, and on that one we won too, causing the IRS to drop its national plan to go after that particular kind of transaction (that involved getting 30 year old briefs out of an IRS storage facility in the middle of a mountain in West Virginia, which that porker Sen Robert Byrd had caused to be put there of course (thank God the records had not yet been destroyed, because the attorney handling the matter unfortunately had been dead for about 15 years, and unavailable to hit up for the docs).  We needed the briefs because  the tax court opinion had an inadequate statement of facts - it turned out the facts made the case a "spotted horse," working for us, and agains the IRS, so the IRS was just totally F'ed, and had to fold).

So there is nothing dishonorable about this. It's as American as apple pie. And aren't you jealous that I get to deal with such fascinating stuff?  

[Torie]

I won't subject you to my anecdotes about property tax appeals. God, I do love those - particularly those with lots of numbers here, there and everywhere, such as commercial properties, on land lease or something, so you get to fight about discount rates and the like. It's wonderful!  

Anyhoo, mansions are tough to value, because they tend to be sui generis, with few or no comps, and the market for them is so thin to boot. Plus if Mittens built the house, he may well have more dough into it, than it is worth. And maybe he indeed just overpaid for it. That can happen. Heck zillow thinks I underpaid for the property below. My purchase is represented by the dollar sign in the green circle.



How am I doing so far in trying to get Mittens' butt out of the wringer here?

[Torie]

I am not arguing that Romney did anything that is illegal or unethical, it is just that his tax activities highlight his ultra-wealth and his working of the system to get himself a better deal.

Do you think this makes middle class Americans like him more?

Oh it may hurt him a tad. But working the system within the law is what America is all about. I don't think most Americans would hold that against him. That is what they would do if they were in his position - almost all of them. And I don't think most are opebo types, who dislike people (at least on a political level) simply because they are rich. They kind of admire rich people, at least those who earned their dough legally.

[Torie]

I am not arguing that Romney did anything that is illegal or unethical, it is just that his tax activities highlight his ultra-wealth and his working of the system to get himself a better deal.

Do you think this makes middle class Americans like him more?

Oh it may hurt him a tad. But working the system within the law is what America is all about. I don't think most Americans would hold that against him. That is what they would do if they were in his position - almost all of them. And I don't think most are opebo types, who dislike people (at least on a political level) simply because they are rich. They kind of admire rich people, at least those who earned their dough legally.

The problem comes in October when he has to go on the national stage and explain why people like him should be given more tax cuts while spending on medicare and social security is cut. Of course he won't say that will he? Maybe just spout out some platitudes about how government sucks and perhaps attack welfare queens.

Mittens denies that he wants to decrease taxes on the rich beyond preserving the Bush tax cuts. I still need to read that study that TheDeadFlagBlues linked for me that I printed out (20 pages), that the Dems are having orgasms over. It seems less about Mittens' plan, than that the Mittens numbers are simply not possible. It should be a fun read to see if it has any little assumptions in it that load the dice.

[Torie]

I believe the Mormon Church will excommunicate members involved in cases of libel, which is what Reid has committed.

Does the LDS hold it's own equivalent trials to make findings of fact that all the elements of libel had been proved by a preponderance of the evidence?  What are the rules of evidence?  I do know they hold excommunication trials, and a lady who said things with which the Church disagreed in her books was so excommunicated, but it was more in the nature of a star chamber proceeding actually. They had all made up their minds in advance, and were just going through the motions. In any event, it strikes me as odd that the LDS would get involved in a civil matter like this. They really can't be that dumb can they?  You are LDS right Winfield? If not, let me know, and I will get off your back on this.

[Torie]

I do not discuss personal matters on public forums.

I have made that clear in the past.

Personal matters, public forums, not a good mix.

Well you were the guy who brought up what you think the LDS does. I was wondering what your expertise about the matter was.