Whoooeeeee... The stuff is about to hit the fan... No wonder he wants to keep those tax returns secret...
Hey, Mitt, how's that "[you little people] don't need to see any more of our tax returns" strategy workin' out for ya? :Whistle
Whooooeeeee... Gawker should talk...
Apparently, nobody thought to tell the boys on the Romney beat that Gawker Media is part of a shell company incorporated in the Cayman Islands. Gawker’s money lives in the same neighborhood as Romney’s money. Call it bipartisanship.
As John Cassidy relates in The New Yorker, Gawker’s finances are “organized like an international money-laundering operation.” For example:
Much of its international revenues are directed through Hungary, where [bossman Nick] Denton’s mother hails from, and where some of the firm’s techies are located. But that is only part of it. Recently, [Felix] Salmon reports, the various Gawker operations—Gawker Media LLC, Gawker Entertainment LLC, Gawker Technology LLC, Gawker Sales LLC—have been restructured to bring them under control of a shell company based in the Cayman Islands, Gawker Media Group Inc.
Why would a relatively small media outfit based in Soho choose to incorporate itself in a Caribbean locale long favored by insider dealers, drug cartels, hedge funds, and other entities with lots of cash they don’t want to advertise? The question virtually answers itself, but for those unversed in the intricacies of international tax avoidance Salmon spells it out: “The result is a company where 130 U.S. employees eat up the lion’s share of the the U.S. revenues, resulting in little if any taxable income, while the international income, the franchise value of the brands, and the value of the technology all stays permanently overseas, untouched by the I.R.S.”
Gee, if he worried as much about off-shore bank accounts; possibly illegal tax-avoidance schemes, and outright lies about welfare work-requirements as he does about allegedly "fake twitter followers", he might have a clue...
Mitt Romney May Have Dodged Taxes In Yet Another Sketchy Way: Report
Meanwhile, the Wall Street Journal's Mark Maremont has found, in some documents not in the Gawker pile, yet another possibly sketchy tax-dodging scheme, this one involving "how the former private-equity executive managed to get $100 million into a family trust for his children without incurring federal gift taxes."
Here's how it works: Start with the fact that Romney and his fellow private-equity kingpins have much of their income taxed at unusually low rates because this income is called "carried interest." These are the fees they skim off the top for watching other rich people's money and managing to not let it get chewed up in the garbage disposal. This is very specialized work, you see, and very important for the economy for some reason, so it is taxed at 15 percent, far lower than normal "income" is taxed.
And, just as you can pass on your large, shiny teeth and thick mane of jet-black hair to your male offspring through your powerful semen, alpha-male private equity executives can also magically pass on their ability to have their income taxed at carried-interest rates to their children and other loved ones. Far less messy than the semen, and more profitable.
The only little problem with passing on this carried-interest tax-rate magic is that some people, let's call them "accountants," think that the ability to have future income taxed at a ridiculously low rate is actually worth some money. So this transfer should, according to these "accountants," be taxed like any other gift when you pass it on to your kids.
But! Maremont has dug up a 2008 presentation by a partner at the Ropes & Gray law firm -- which represents Romney and his old firm, Bain Capital -- in which he tells a bunch of other lawyers that, for several years starting in the 1990s, many estate-planning lawyers tried to pretend this magical carried-interest tax rate wasn't worth anything, to help clients avoid paying gift taxes when they passed it on. Was it illegal to do this? Maybe so! But the lawyers tried to do it anyway, up until 2005, when the practice apparently died of shame.
Mitt Romney Reaped Huge Tax Benefits Based On 'Active' Role At Bain Capital
WASHINGTON -- Mitt Romney has repeatedly insisted during the presidential campaign that layoffs and other controversy surrounding Bain Capital companies for the past decade are not his responsibility, because he retired in 1999. When tax experts charged that he benefited from legally dubious tax avoidance strategies employed by Bain, his campaign noted that the investments are kept in a blind trust completely out of his control.
"As we have said many times before, Governor and Mrs. Romney's assets are managed on a blind basis. They do not control the investment of these assets. The investment decisions are made by a trustee," spokeswoman Michele Davis said.
But according to his 2010 tax return, when the Internal Revenue Service comes calling in April, Romney has a different answer: The presumptive GOP nominee reaps lucrative tax breaks for "active" participation in the private equity firm he founded, as well as a host of other investments.
The IRS advises that "[f]actors that indicate active participation include making decisions involving the operation or management of the activity, performing services for the activity, and hiring and discharging employees. Factors that indicate a lack of active participation include lack of control in managing and operating the activity, having authority only to discharge the manager of the activity, and having a manager of the activity who is an independent contractor rather than an employee."
Even if Romney could persuade the IRS his involvement was legitimately active, that still leaves him in a rhetorical jam: For tax purposes, he claims an active status; for political purposes, he claims to have zero to do with the investments.
With those active investments, he is also securing a tax break few Americans enjoy: When he wins, he's paying a 15 percent rate on the gain. When he loses, he's writing it off at 35 percent, meaning that tax policy is subsidizing Romney's risk in his Bain investments.
In other words, Romney didn't build that, at least not without taxpayer backing.
RMoney's going down.... :thumbsup:
