Is This Why Mitt Won't Show His Tax Returns?

[Sue U]

Perhaps it's the 2008 Swiss banking scandal and the subsequent amnesty the IRS gave to tax cheats:

Is Romney Trying to Conceal a Massive Tax Fraud Scheme?
Mitt’s Big Secret

by DAVE LINDORFF

A lot of theories have been put forward to try and explain why Romney has allowed his campaign to become bedeviled by charges of tax dodging, but what if what he is hiding is felonious tax fraud?

Okay, so he’s taken the legal option of delaying filing his 2011 taxes, which every taxpayer is entitled to do without penalty and without having to give any explanation until October 15 this year (I agree it’s a little weird when a super-rich guy who pays accountants by the dozen does this, but hey). The nagging question though is why he hasn’t just responded to the demand that he release two years of tax returns like John McCain did in 2008 by simply releasing his 2009 tax filing, along with the 2010 return he already released?

The answer may well be that 2009 was the year that the Treasury Department decided to offer an amnesty from prosecution for tax fraud to any of the tens of thousands of millionaires who were known or suspected to have illegally hidden income abroad in the Cayman Islands or in Swiss banks — a felony, but one that people thought they’d never be caught at.

That year alone, some nearly 30,000 people, many of them no doubt prominent in society, politics and business, and customers of the finest accounting firms, reportedly voluntarily came forward to the IRS to admit that they had hidden some of the estimated $100 billion in income that crooked rich Americans have for years been secreting away in banks overseas. Under the terms of the program, they were able to just report their fraud, pay the taxes, penalties and interest on the money and then walk away scott free, with no charges and with their returns kept confidential by the agency.

That is, unless they decided to run for national office, where the expectation is that they have to release their income tax returns to the media for inspection.

As journalist Matthew Yglesias has written in Slate, “Romney might well have thought in 2007 and 2008 that there was nothing to fear about a non-disclosed offshore account he’d set up years earlier precisely because it wasn’t disclosed.”

But the scandal that exploded around Swiss megabank UBS, where a whistleblowing employee released some of the names of wealthy Americans who were being allowed to use the bank’s privacy protections to hide their income from the IRS, caused many of America’s super-rich, fearing the worst, to rush for an amnesty offered by the IRS, which was more interested in collecting the money than putting a lot of the country’s toniest people behind bars. The floodgates opened when the US sued UBS demanding the full list of tax criminals from the bank, and then offered an amnesty to those who came forward voluntarily, reported their fraud to the IRS, and paid the required interest and penalties.

Given Mitt Romney’s known predilection for avoiding taxes, it’s hard to imagine him not having taken advantage of the Swiss tax dodge, particularly when so many other people of his class were doing it. Hiding income overseas was, back in the early years of this gilded century, the thing to do–the stuff of mirthful asides over cognac at the Club after a bracing game of golf or polo.

But explaining paying lower taxes than your maid or gardner to the public is one thing. Explaining deliberately committing massive tax fraud is another. Plenty of Americans have gone to the slammer for years for defrauding the IRS of mere five-figure sums. Most live in a cultivated fear of the IRS, worrying that they made some mistake on a form or missed a filing deadline, and yet the wealthiest Americans, thanks to the 2009 and subsequent amnesties or partial amnesties, have gotten away with massive fraud, just having to pay penalties and interest, as if they had just inadvertently filed late or made a math error.

None of this is proof that Romney is guilty of felony tax fraud, of course. On the other hand, it is curious that John McCain would have gone for the loopy lady from Wassilla and rejected Romney as his running mate back in 2008. Mitt was seriously in the running as a candidate for the job of VP on the McCain ticket at one point, and the UBS scandal broke right when McCain was picking his running mate. It seems logical that McCain’s vetting team would have asked Romney if the scandal might touch him. Maybe they ruled him out of contention when they got the answer.

In any case, running for president is not for sissies, and there is no presumption of innocence in politics. If Romney did not commit tax fraud back in 2008 and earlier, and did not avail himself of the IRS’s 2009 tax amnesty program, he should have to prove it by releasing his 2007, 2008 and 2009 taxes, and, if the 2007 and 2008 filings turn out to have been belatedly corrected, he should have to show the original filings too.

No doubt the Obama campaign has figured all this out, which would explain why they are offering Mitt Romney a deal that says: “You release five years of your taxes, and we’ll shut up” about demanding even older ones.

It remains to be seen whether conservative and right-wing and libertarian Americans, famous for their loathing of taxes, will decide that Romney is simply doing what they’d all like to get away with doing, and give him a pass on all this tax dodging, or whether they will become so incensed at the idea of this richest of presidential candidates in history cheating on his taxes that they will demand that he prove he didn’t do it before he can have their vote.

Meanwhile, if Romney did commit tax fraud courtesy of a Swiss bank arrangement, and he stonewalls it through the campaign weeks ahead, he runs a huge risk that someone will leak the information. After all, federal employees have to realize that four years of a Romney/Ryan administration will be brutal on their job security, benefits and working conditions. And right now Obama is the boss of the federal government, with his own appointees at Treasury and the IRS.

Stay tuned.

Dave Lindorff is a founder of This Can’t Be Happening and a contributor to Hopeless: Barack Obama and the Politics of Illusion, published by AK Press. Hopeless is also available in a Kindle edition. He lives in Philadelphia.

http://www.counterpunch.org/2012/08/21/ ... ig-secret/

[MajGenl.Meade]

Perhaps it's the 2008 Swiss banking scandal and the subsequent amnesty the IRS gave to tax cheats:

A lot of theories have been put forward to try and explain why Romney has allowed his campaign to become bedeviled by charges of tax dodging, but what if what he is hiding is felonious tax fraud?

The answer may well be .....
As journalist Matthew Yglesias has written in Slate, “Romney might well have thought .......”
Given Mitt Romney’s known predilection for avoiding taxes, it’s hard to imagine him not ....
None of this is proof that Romney is guilty.....
Maybe they ruled him .......
If Romney did not commit tax fraud ...... he should have to prove it
Meanwhile, if Romney did commit tax fraud ....

Quote edited to get to the really important parts - hope the investigative journalism students are paying attention

Meade

[Big RR]

I don't agree Meade--the author is asking valid questions; the ball is now in Romney's court. This is not a criminal investigation, but a campaign where people are free to draw whatever conclusions they want.

[Scooter]

Indeed, if a candidate has not been forthcoming with information which has become standard fare in every presidential election, then he has invited on himself any speculation that ensues as to why he has chosen not to release it. He has the power to end such speculation any time he chooses. Or he can continue to add fuel to the fire by choosing to remain secretive.

[MajGenl.Meade]

I don't agree Meade--the author is asking valid questions; the ball is now in Romney's court. This is not a criminal investigation, but a campaign where people are free to draw whatever conclusions they want.

Well Big RR you may well have been paid by the Obama campaign to make that statement. You may well have thought that no one would realise it. Given your known predilection for honest money and liberal ideas, it's hard to imagine you'd miss the opportunity. If you did not take any money you should have to prove it.

There - that was easy. Should have been a journo. Ball's in your court.....

Meade

[oldr_n_wsr]

(I agree it’s a little weird when a super-rich guy who pays accountants by the dozen does this, but hey).

Re: filing an extension.
When I ws first married my wife worked for an accounting firm who did taxes for many of the super wealthy (Trump, Rockerfeller among others) and they all filed extensions. Usually because multiple firms handled multiple sides of income and businesses and getting them all together from January to April to file all the forms and such needed was an insurmountable obstacle. they ain't filing a 1040EZ.

[Big RR]

OK Meade==you're free to ask that and any other question you want. And if I ever run for national office, I may answer that by making my income records open to the public. As I'm not, and I really don't care what anyone thinks, I'll refrain from doing so.

[dgs49]

As has been pointed out in the past, people in Mitt's bracket are audited every year. Every year. If there were any illegal activity going on - or even a credible allegation of malfeasance, given the proclivities of the Non-Fox media, we would know about it.

Also, honesty and candor would impel the author to state, at least in passing, that one of the prerequisites to delaying one's filing is PAYING THE TAXES BY APRIL 15th. This minor detail, of which most Americans are probably unaware is rather relevant to the story, since the drift of it is that Mitt is a cheater (at best).

The failure of the NFM to pursue Barry's withholding of his academic records, when juxtaposed with this sort of tripe, merely magnifies the case of the said Media being in the Democrats' pocket.

Governor Romney has no legal or ethical obligation to expose his financial soul to the frenzied media, and his unwillingness to do so affects not a single vote. Which is why he is not likely to expose himself between now and election day.

[rubato]

As has been pointed out in the past, people in Mitt's bracket are audited every year. Every year. If there were any illegal activity going on - or even a credible allegation of malfeasance, given the proclivities of the Non-Fox media, we would know about it.

... "

Really? Do you have any evidence that this is true? Any at all?

yrs,
rubato

[rubato]

Mittsy won't show his tax returns because even if he is within the narrow limits of the law he is doing things the average person will see as dishonest and crooked.

How does an honest person get $100,000,000 in a 401k? The annual limit (if you're over 50) is $22,500 this year (plus employer matches).



yrs,
rubato

[Long Run]

It's a fair question: who is this guy who could be president and what do we know about him. Maybe we should have had such intense questioning with respect to a much less well-known candidate four years ago. And maybe we should still be asking such probing questions of a president we don't know very well. What's good for the goose and all that.

As to the IRA success: http://www.boston.com/news/politics/art ... ce/?page=1

It is one of the most striking elements of Mitt Romney’s financial fortune. He has used the seemingly bland investment vehicle known as an individual retirement account — established by Congress to help average Americans save a modest amount for retirement — to shield at least $20 million and as much as $100 million from initial taxes.

Note that a key piece of this story is often overlooked -- he may defer taxes with assets/earnings in an IRA, but he will have to pay taxes on distribution, and the government will come out way ahead. Instead of getting the lower capital gains rate he would receive if he did his investing outside of the IRA, he will pay at the higher income tax rate when he receives his distributions. Plus the investments in the fund grow much faster than the government's rate of borrowing, meaning from an actuarial standpoint, the $20 million in the IRA today is actually worth much more than that to the government. (Except our government accounts for itself on a nonsensical annual cash budget, rather than the accrual accounting that it requires of business entities).

Romney has not provided details about how his IRA grew so large. But Romney associates with direct knowledge about the matter said Bain Capital partners used their IRAs as a pool of investment money, enabling them to make personal investments in Bain deals, many of which earned spectacular returns.

Mystery solved. Now go focus on something important.

Bain employees, including Romney, enjoy a much richer retirement plan than most Americans. Instead of offering a 401(k) plan, in which employees set their own money aside, sometimes with a contribution from their employer, Bain funds the maximum amount it can, every year, in its employee IRAs. * * *

Under current federal limits, Bain can contribute up to 25 percent of an employee’s salary, up to an annual maximum of $50,000, to employee IRAs. The Bain contributions helped partners establish IRAs that could be used as a pool of funds for the side investments, which then grow swiftly as new deals turns profits and taxes are deferred.

The law is pretty simple in concept: there is a limit to how much may go in; and another rule requires minimum distributions starting at age 70 1/2. The government gets their money in the end, especially from wealthy people. And in Romney's case, the government will end up with much more money in nominal terms and on actuarially basis because he used his SEP-IRA to fund these investments.

[Long Run]

Of course, the other point that fails to get made in every story on this topic is just how successful Romney is. Don't we want a smart, capable person as the person to take charge during an extremely challenging time, rather than a guy who has shown his inexperience, and may talk a good game but is not up to the job?

[Scooter]

If you define buidling a vulture capital empire as success, I guess. Perhaps some people are looking for a president with a record of creating jobs, rather than destroying them.

[dgs49]

And who, exactly, has a record of creating (non-government) jobs?

How fucking delusional are you?

And yes, any sane person who has ever been gainfully employed and understands what a venture capitalist does, considers Bain Capital and those who founded it to be wildly successful. They have created and saved (to coin a phrase) thousands of jobs and made hundreds of millions in gains/profits. If that ain't success, what is?

Compare with a "community activist," whose role in life is to assist the Downtrodden in suckling more successfully from the governments teats.

Unbelievable.

And who in his or her right mind considers that someone who pays millions of dollars every year in Federal income taxes is somehow shirking his obligations?

The answer is apparent: no one in his or her right mind. Only Democrats. And Canadians.

[Scooter]

4.5 million private sector jobs created under this administration.
30+ continuous months of private sector job growth.

I understand it's hard for you to accept that a black president could accomplish that, but facts are facts.

[Andrew D]

Oh, dgs49, do at least try to acquaint yourself with some relevant facts, will you?

Seriously, will you?

The economy under Obama -- and this is despite the congressional Republicans' having taken almost every opportunity to sabotage economic recovery -- has created more private-sector jobs than your people under Shrub ever managed. Get it?

Under Shrub, the number of public-sector jobs went up. Under Obama, the number of public-sector jobs has gone down. Get it?

Probably not.

So to be more specific:

]And who, exactly, has a record of creating (non-government) jobs?

Obama.

Fact: As of 1 June 2012, there were more private-sector jobs in the economy than there were when Obama took office.

Fact: Since February 2010, the number of private-sector jobs has gone up by 4.3 million.

Compare with a "community activist," whose role in life is to assist the Downtrodden in suckling more successfully from the governments teats.

Yes, let's do that.

Fact: Since Obama took office (January 2009), the number of public-sector jobs has gone down by 2.7%.

Fact: At the same time in Shrub's term, the number of public-sector jobs had gone up by 3.7%.

Get it now?

Probably not.

[Econoline]

The law is pretty simple in concept: there is a limit to how much may go in; and another rule requires minimum distributions starting at age 70 1/2. The government gets their money in the end, especially from wealthy people. And in Romney's case, the government will end up with much more money in nominal terms and on actuarially basis because he used his SEP-IRA to fund these investments.

...unless, of course, a Republican President and a Republican Congress do something to change those laws. Naw, something like that could never happen, could it?

Face it, the priority of the Republican party is to shrink or eliminate any part of the federal government which does not directly benefit the very rich. They will reduce taxes (but only if most of the reduction goes to the richest Americans) and then use the deficit that creates as an excuse to shrink or eliminate any part of the federal government which does not directly benefit the very rich.



P.S. ..."a guy who has shown his inexperience, and may talk a good game but is not up to the job?"

As far as I'm concerned, that describes Romney to a tee.

Running a government of the people, by the people, for the people (to use a Grand Old Phrase ) is not the same as running a public corporation, let alone a private venture capital firm. If Romney had been an extremely successful and popular two-term governor, that might be enough to mitigate (Mittigate?) his resume, but he wasn't, and he seems to be constantly running away from his past. He may talk a good (but vague and non-specific) game, but he has not convinced me he is up to the job.

[rubato]

It's a fair question: who is this guy who could be president and what do we know about him. Maybe we should have had such intense questioning with respect to a much less well-known candidate four years ago. And maybe we should still be asking such probing questions of a president we don't know very well. What's good for the goose and all that.

As to the IRA success: http://www.boston.com/news/politics/art ... ce/?page=1

It is one of the most striking elements of Mitt Romney’s financial fortune. He has used the seemingly bland investment vehicle known as an individual retirement account — established by Congress to help average Americans save a modest amount for retirement — to shield at least $20 million and as much as $100 million from initial taxes.

Note that a key piece of this story is often overlooked -- he may defer taxes with assets/earnings in an IRA, but he will have to pay taxes on distribution, and the government will come out way ahead. Instead of getting the lower capital gains rate he would receive if he did his investing outside of the IRA, he will pay at the higher income tax rate when he receives his distributions. Plus the investments in the fund grow much faster than the government's rate of borrowing, meaning from an actuarial standpoint, the $20 million in the IRA today is actually worth much more than that to the government. (Except our government accounts for itself on a nonsensical annual cash budget, rather than the accrual accounting that it requires of business entities).

Romney has not provided details about how his IRA grew so large. But Romney associates with direct knowledge about the matter said Bain Capital partners used their IRAs as a pool of investment money, enabling them to make personal investments in Bain deals, many of which earned spectacular returns.

Mystery solved. Now go focus on something important.

Bain employees, including Romney, enjoy a much richer retirement plan than most Americans. Instead of offering a 401(k) plan, in which employees set their own money aside, sometimes with a contribution from their employer, Bain funds the maximum amount it can, every year, in its employee IRAs. * * *

Under current federal limits, Bain can contribute up to 25 percent of an employee’s salary, up to an annual maximum of $50,000, to employee IRAs. The Bain contributions helped partners establish IRAs that could be used as a pool of funds for the side investments, which then grow swiftly as new deals turns profits and taxes are deferred.

The law is pretty simple in concept: there is a limit to how much may go in; and another rule requires minimum distributions starting at age 70 1/2. The government gets their money in the end, especially from wealthy people. And in Romney's case, the government will end up with much more money in nominal terms and on actuarially basis because he used his SEP-IRA to fund these investments.

Do the arithmetic and show us how that works. You know arithmetic don't you?

Show us how Mitty could put in the allowable amount every year and get that total.

You can do that can't you? It's a simple calculation.

yrs,
rubato

[oldr_n_wsr]

4.5 million private sector jobs created under this administration.
30+ continuous months of private sector job growth.

I understand it's hard for you to accept that a black president could accomplish that, but facts are facts.

Is that a "net" job creation or the "gross" job creation? And what type of jobs are those? "Do you want fries with that" will not support a family.
More people are un/under employed now than pretty much ever in my time here in the job market. With unemployment (at the recorded rate which does not include those who have given up) still over 8% seems that those jobs created have not kept pace with jobs lost nor the amount of people entering the work force.

[Long Run]

The recovery has been a disappointment, particularly on the job creation front. While there has been some job growth, it has been extremely slow, especially considering how bad the economy was. Based on past recessions, the worse the recession, the stronger the recovery; but this recovery is not following the norm. R's will say its Obama's wrong-headed policies. And D's will say it is because the mess caused by Bush was so bad.

The vast majority of the lost jobs had occurred by the time Obama took office, so there was nowhere to go but up at that point. In contrast, when Bush took office, the dot.com bust/9-11 recession had not hit yet, so employment was relatively high, and it is easy to see why there was a net job loss -- comparing the employment high point to the employment low-point, and ignoring all of the job growth that occurred during the interim 7-8 years. Similarly, it is not very useful to point to 4.5 million new jobs without comparing that to the number of lost jobs that need to be replaced -- 8.3 million to get back to where we were at the end of 2007. The current pace will get us there in 2016. To materially reduce unemployment, 200,000 jobs a month need to be created, and that has occurred in only 4 months of the recovery (mostly last winter). Since April, the job creation has been in the 50,000 to 100,000 range. So obviously, for whatever reason, the rate of job growth is not something to point to as an example of Obama or Congress doing a good job or making things better.