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View Diary: Rolling Stone Magazine Exposes how Mitt Romney Dodged his Taxes (252 comments)

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  •  grumpe - if it was criminal Romney would (1+ / 0-)
    Recommended by:
    JG in MD

    be charged with a crime. I have not seen anything written by a tax professional that even suggests that Romney is guilty of any criminal conduct concerning his taxes. Big four CPA firms don't file tax returns that put their clients at risk for being charged with criminal conduct. If they did, they would go out of business. It's not even "cheating".

    "let's talk about that"

    by VClib on Sat Oct 13, 2012 at 05:05:35 PM PDT

    [ Parent ]

    •  Then you haven't looked in the right places (6+ / 0-)

      Try here:

      "He aggressively exploits every loophole he can find," says Victor Fleischer, a professor of tax law at the University of Colorado. "He's pushing the limits of tax law beyond what many think is reasonable."
      Not content with the carried-interest boondoggle, Bain also uses a scheme known as fee conversion to transform smaller management fees – which are supposed to be taxed as regular earnings – into investment income taxed at only 15 percent. A Bain manager simply "waives" his right to his fee and is instead staked an investment of equal value in the private equity fund. Because the manager can then cherry-pick from the fund's investments, he is virtually guaranteed a rich return – flouting the spirit of the lower tax rate on capital gains, which is designed to reward investors who take risks with their money. "Because they didn't receive the cash, they claim that it's not a taxable event," says Fleischer. "It's not legal." New York's attorney general has launched a criminal investigation into the practice.

      Others have simply gotten old. I prefer to think I've been tempered by time.

      by Just Bob on Sat Oct 13, 2012 at 10:25:56 PM PDT

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      •  Bob - thanks for the reference (1+ / 0-)
        Recommended by:

        I thought that practice started after Romney had left Bain Capital.

        "let's talk about that"

        by VClib on Sat Oct 13, 2012 at 11:00:30 PM PDT

        [ Parent ]

      •  Speaking of looking, check out Mitt's Blind Trust (4+ / 0-)

        Mitt's Blind Trust (to the meter of 3 blind mice)

        Mitt's blind trust
            see how it grows
        Its being fed
            by heaven only knows
        normal people like you and I
        working three jobs just to try and get by
        While Mitten's fine millions are hanging to dry
        in Mitt's blind trust

        Mitt's blind trust
            my how it grows
        no matter who's in charge
            it never seems to slow
        companies go into bankruptcy
        Mitt just say's that its OK by me
        'cause all that they are is an entity
        in Mitt's blind trust

        Mitt's blind trust
            tied up in bows
        he's cleaning up   
            his earnings never close
        He wakes up each morning to find he's made more
        than two years of wages for scrubbing his floors
        he's hoarding his money behind the locked doors   
        in Mitt's blind trust

        Mitt's blind trust   
            who could complain?   
        the guy that runs his trust
            is running his campaign
        behind the curtains he's pulling the strings
        deftly outrunning the masses he thinks
        and hoping that no one will notice the stink
        from… Mitt's Blind Trust.
        Copyright 2012
        I invite any kosacks with musical ability to make a recording or anyone can offer additional verses. Thanks for looking. Let's bury this guy in the next two weeks.

      •  that's not criminal, and its not even (2+ / 0-)
        Recommended by:
        VClib, Shawn Russell

        obvious its the wrong tax position to take.

      •  My understanding (4+ / 0-)

        of the current federal tax law in this issue is that it is an open question as to whether or not that "waiver" is a realization event.  Thus it would be very hard to get someone for criminal tax fraud on the issue because it is an open question, so you can't willingly violate a law that is unclear.    It is, however, a very aggressive position because it goes against the standard structure and thinking that underpins the code.

        I can easily argue the reason why is is not appropriate under the current tax laws.  If I (or the IRS) were to win, he would have his taxes adjusted and pay interest, and maybe penalties.  In that sense, it is not "legal" but I do not think it is federally criminal.

        The bigger question, in my mind, is that if good tax policy should say that it is a realization event and we should tax it as if he got the fee (ordinary income) and reinvested it in the partnership, is Mitt Romney the guy who is going to advocate for that change in the code.  Hell no.

        I don't know upon what basis NYS is looking into it, but I do not believe they have authority to enforce the federal tax laws.  Therefore, it must be a state issue.

        •  Part of my point is that if someone is (3+ / 0-)
          Recommended by:
          Shawn Russell, Just Bob, JG in MD

          running for the highest elected office in the country, neither the feds, nor the state/s, nor the people of the US should have to expend this much time/effort/money into figuring out whether the guy's a criminal or not. This level of ambiguity should be a disqualifier from the get go. Period.

          •  I don't have an issue with this (0+ / 0-)

            I don't think his attitude toward the tax code is appropriate for a chief tax administrator ... EVEN IF NOTHING HE DID WAS CRIMINAL... or someone I would want to see overseeing change in the tax code.

    •  VClib, you don't know what you are talking about (7+ / 0-)

      How about THIS story that discusses Big 4 accounting firms getting FINED and their partners getting INDICTED for pushing tax dodges? (And it has a Mittens twist too!)

      A few select quotes, just for your reading enjoyment:

      Willard Mitt Romney, was named after the chain’s founder, J. Willard Marriott, a friend of his father. He joined the company’s board in 1993, and has served on it for 11 of the past 19 years, including six as chairman of the audit committee.
      During Romney’s tenure as a Marriott director, the company repeatedly utilized complex tax-avoidance maneuvers, prompting at least two tangles with the Internal Revenue Service, records show. In 1994, while he headed the audit committee, Marriott used a tax shelter known to attorneys by its nickname: “Son of BOSS.”
      Now that the Romney-Marriott connection is clear, here is how illegal what Mittens did:
      A federal appeals court invalidated the maneuver in a 2009 ruling, siding with the U.S. Department of Justice, which called Marriott’s transaction and attempted tax benefits “fictitious,” “artificial,” “spectral,” an “illusion” and a “scheme.” Marriott had argued the plan predated government efforts to close such shelters.

      Employing another strategy, Marriott legally avoided hundreds of millions of dollars in income taxes thanks to a federal tax-credit program criticized and allowed to expire by Congress. Marriott has also shifted profits to a Luxembourg shell company. During Romney’s years on the board, Marriott’s effective tax rate dipped as low as 6.8 percent, compared with the federal corporate statutory rate of 35 percent.

      And HERE is where the accountants got NAILED:
      “This is pretty much the poster child for those classic early tax shelters: you use a hyper-technical reading of the tax law to obtain what are, by any standard, unwarranted tax benefits,” said Robert Willens, a tax-accounting analyst in New York who advises investors.
      A version of that same strategy got others in bigger trouble. Partners at KPMG LLP counseled their clients on Son of BOSS structures, leading to a $456 million deferred prosecution agreement with the Department of Justice and causing the indictment of several former partners there, along with partners at Ernst & Young LLP. (The nickname is derived from an acronym for an earlier version of the shelter -- Bond Options Sales Strategy.)
      Last time I looked, KPMG and E & Y were TWO of the Big 4: PriceWaterhouseCoopers, Deloitte, KPMG and Ernst & Young.

      But we all know accountants NEVER do anything that might be illegal. Just indictable.

      "The battle, sir, is not to the strong alone; it is to the vigilant, the active, the brave." -- Patrick Henry November 6, 2012 MA-4 I am voting for my friends Barry, Liz and Joe (Obama, Warren and Kennedy)

      by BornDuringWWII on Sat Oct 13, 2012 at 11:00:06 PM PDT

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      •  Right. They're not paid to keep it "legal" (1+ / 0-)
        Recommended by:
        JG in MD

        they're paid to keep it buried so deep, so knotted up in loopholes, that it would take a team of legal experts/accountants to find it.

        Beyond that, it's the same argument thugs and criminals throughout history have used to justify their criminal behavior "well, it was legal." Yeah, like the Nuremberg Laws, right? Like slavery in the US. Like apartheid in South Africa.

        All of it, perfectly "legal". At the time.

        Hate to see what would be "legal" 2 months into a Rommey administration! And that's exactly the point: The only reason this asswipe is seeking office is so that he has more control over the laws governing what he does with his money.

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