FOIA Report Shows How Mitt Romney Avoided Paying Taxes For 15 Years

October 29, 2012
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Bloomberg News confirmed through using a Freedom of Information Act request that Mitt Romney set up a charitable remainder unitrust (CRUT) in June 1996 just before Congress cracked down on the loophole in 1997. While Republicans have extolled Romney for his charitable donations, most of them are contributions to the Mormon Church, and according to this, the church will likely receive even less than the primary donation, while he is benefiting.

Individuals who had already set up these vehicles were allowed to keep them. That included Mitt Romney, then the chief executive officer of Bain Capital, who had just established such an arrangement in June 1996.

“In this instance, Romney used the tax-exempt status of a charity — the Mormon Church, according to a 2007 filing — to defer taxes for more than 15 years,” Bloomberg’s Jesse Drucker explained. “At the same time he is benefitting, the trust will probably leave the church with less than what current law requires.”

While Romney’s tax avoidance is legal, it’s still questionable since he has refused to release his tax returns.

“In this instance, Romney used the tax-exempt status of a charity — the Mormon Church, according to a 2007 filing — to defer taxes for more than 15 years,” Bloomberg’s Jesse Drucker explained. “At the same time he is benefitting, the trust will probably leave the church with less than what current law requires.”

“The main benefit from a charitable remainder trust is the renting from your favorite charity of its exemption from taxation,” Blattmachr said. Despite the name, giving a gift or getting a charitable deduction “is just a throwaway,” he said. “I used to structure them so the value dedicated to charity was as close to zero as possible without being zero.”

(my bold)

When individuals fund a charitable remainder unitrust, or “CRUT,” they defer capital gains taxes on any profit from the sale of the assets, and receive a small upfront charitable deduction and a stream of yearly cash payments.

As the article explains Romney’s CRUT,  is only a small part of the $250 million that Romney’s campaign cites as his net worth, and has been paying him 8 percent of its assets each year. “As the Romneys have received these payments, the money that will potentially be left for charity has declined from at least $750,000 in 2001 to $421,203 at the end of 2011.”

Jesse Drucker wrote a detailed article surrounding Mitt Romney’s tax avoidance, which I urge you to read.

Someone call Harry Reid, quick!

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  • The White Rabbit!

    He’s a coke and arms money launderer. Cut this ‘tax avoidance’ bullshit and stare at reality. Madof got jailed for 10% pa returns, how else do you think Mitt The Mafia Hit Romney got 160% YEAR ON YEAR ON YEAR.

    Want the proof?

    http://www.occupythebanks.com/2012/10/mitt-mafia-hit-money-launderer-exposed.html

    Want the DOX?

    http://www.occupythebanks.com/2012/07/doxed-bain-capital-organised-crime-uk.html

  • SuziBrookz

    CRUT’s are tax deferral vehicles, not avoidance. No liberal bias in this article ……..

    • http://pulse.yahoo.com/_K632TZJIMGU7TOWACHTKIQPMPA Mutant

      That’s wholly incorrect. CRTs avoids taxes. Period. No blind, conservative bias in your comment. http://www.assetlawyer.com/estate_tax_planning_bypassing_capital_gains_tax.htm

    • http://pulse.yahoo.com/_K632TZJIMGU7TOWACHTKIQPMPA Mutant

      That’s wholly incorrect. CRTs avoids taxes. Period. No blind, conservative bias in your comment. http://www.assetlawyer.com/estate_tax_planning_bypassing_capital_gains_tax.htm

      • SuziBrookz

        Minimization is not avoidance. Some of us get rich because we know how the system works, not because we cheat.

    • David

      Indefinite deferral = avoidance. No ignorance in your comment……

      • SuziBrookz

        The beneficiary of the that deferral is the charity, not the CRUT beneficiary. Think before you speak please.

    • Manticore

      So what about the Cayman Island accounts? Are those “deferral vehicles” too?

      • Mitt Romney

        I deferred them all the way to the Caymans. I am that special.

    • Anonymous

      That’s why they’re now illegal.

    • Whata Toolsack

      SuziBrookz – It is ignorance like that that is killing us as a nation. Uninformed people like yourself blindly following a completely ignorant liar. Thank you for being a shining example of what we do NOT need. As long as we do the opposite if what you think, we will be great! So, I suggest that you 1) get a clue; 2) READ. And I mean read something other than the Fox News BS. Start with the link Mutant below posted and LEARN something. Then maybe you will see why your comment makes you look uneducated or stupid. 3) Try thinking for yourself. I could go on and on, but I am sure you won’t read this anyway, and even if you did, you would never actually take the time to educate yourself. I have found that the 43% of people that are voting for Romney are either racists or uninformed sheep. Which are you?

      • SuziBrookz

        Sorry, not true. Tax is paid when the payout is made to the CRUT beneficiary. See the article you cite, it says.

        “Instead, your taxes are calculated based on how the CRT earned the income; regular income and
        capital gains are taxed at their respective rates.”

  • http://twitter.com/MicheleBach666 Dr. J

    How anyone can vote for this draft dodging no tax paying scumbag? Mitt Romney’s life has been about taking advantage of the greatest country in the world and not contributing any blood or cash to make it great. It’s sick to vote for a draft dodging war monger like Romney. He is more than happy to send the poor to die nowadays but when he had his chance to fight in Vietnam he used his cult to hide in a mansion in France. He is a terrible human being.

    • jaay

      Yea try telling those 43% of the people who are actually voting for him. I can’t believe people are actually that stupid. I mean Romney has shown no plans nor he has any to make this country better. I really hope for this country’s sake that Obama wins or else we are all screwed.

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