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View Diary: Romney's Tax Returns May Hide Much More Than Low Taxes (83 comments)

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  •  Looks like a way to avoid state tax? (1+ / 0-)
    Recommended by:
    MKSinSA

    I think Utah's tax is a flat 5%, but that's still a hefty chunk of a change when one's primary source of income is investments (dividends and capital gains).

    •  Massachusetts is not favorable (2+ / 0-)
      Recommended by:
      congenitalefty, PinHole

      Romney claims to be domiciled in Massachusetts, though you never know whether he divides his voting life, his taxing life, and his other lives.  Massachusetts income tax is twice as high on "unearned" (capital gains, dividends and interest not from in-state banks) income as on "earned" (wages) income.  It's not progressive, but it's around 11% on the unearned stuff, if it gets counted here.

      •  where does Romney pay state taxes? (1+ / 0-)
        Recommended by:
        MKSinSA

        Many states let you pay the tax on a portion of your income earned out-of-state, but there does have to be a home state off which the other states' tax bills are subtracted. I assume that state has to be the same one as is shown on the 1040 as the taxpayer's home state.

        It would be interesting, I think, to see how he divvies up his state tax eligibility. For instance, I know that NH, where at least one of Romney's homes is located, doesn't tax earned income at all but does tax interest and dividends (and capital gains??). Would he report his salary (if he has one) in NH, but place his investment income in some other state with a tax code more favorable to that class of income?

        Labor is prior to, and independent of, capital. Capital is only the fruit of labor, and could never have existed if labor had not first existed. Labor is the superior of capital, and deserves much the higher consideration. -- K.Marx A.Lincoln

        by N in Seattle on Fri Sep 28, 2012 at 09:20:50 PM PDT

        [ Parent ]

        •  If he's a MA resident, he pays tax on 100% (3+ / 0-)
          Recommended by:
          Kane in CA, N in Seattle, VClib

          of his income to MA regardless of where it's earned.  They'll give a credit for taxes paid to other states, but will tax the excess if the other state has a lower rate.  

          Example: I live in NY, w/ a 9% rate (rounding), I work in CT with a 5% rate.  I pay 5% to CT on my salary earned in CT, and pay the difference of 4% to NY.

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