Mitt Romney released his tax returns on January 24th, 2012. His 2010 earnings showed $21.7 million in income with an effective tax rate of just 14%. Newt Gingrich shared his tax return last week and his tax rate came in around 31%.
Why is Romney’s Tax Rate so low? Unlike Newt, Romney’s income mostly comes from dividends that are not taxed at the same rate as ordinary income; dividends are typically taxed at 15%. Romney’s tax rate was dropped more from charitable donations and other itemized deductions that he was able to claim. Many people take this lower tax rate out of context because they don’t understand that the capital gains income he’s receiving has already been taxed by the government before he received the income.
Highlights from Mitt Romney’s Tax Return
- Donated $7 million in the past two years
- Donated $4.1 million to the Church of Jesus Christ of Latter-day Saints
- Majority of income came in the from of dividends
- Tax rate of 14%
- Mitt’s real first name is Willard
Romney stated that his tax return is “entirely legal and fair.” He also stated: “I pay all the taxes that are legally required and not a dollar more. I don’t think you want someone as a candidate for president who pays more taxes than he owes.”
Links to Tax Returns
- 2010 Mitt & Ann Romney Return
- 2011 Mitt & Ann Romney Estimated Return
- 2010 Mitt Romney Trust Return
- 2010 Ann Romney Trust Return
- 2010 Family Trust Return
- 2010 Tyler Charitable Foundation Return
Related posts:
- Mitt Romney & Ron Paul: Historic Overview of Their Views on Taxes
- Newt Gingrich Shares His 2010 Tax Returns
- Understanding the Child Tax Rate for Your Children’s Investment Income
- The Bonus Tax Rate: Understanding Taxes on Year-End Bonuses
- When Income Reported on Tax Returns Doesn’t Match Bank Records
