Yeah, he did it again (video from Lawrence O'Donnell's The Last Word):
The idea that someone could pay zero gift taxes on contributions to a $100 million trust fund may surprise people who have heard arguments that the wealthy are overburdened by gift and estate taxes. But the Romneys’ gift-tax avoidance strategy is perfectly legal.[...]
The explanation may stem from how the Romneys were able to value the assets put into the trust. If I’m right, it involves a special tax deal that Congress gives to people who manage investment partnerships, as Romney did at Bain Capital from 1984 to 1999.
This deal allows these managers to receive a kind of compensation known as “carried interest.” As the tax law sees it, carried interest does not represent ownership of stock or other securities, only the right to receive future profits. Because there is no ownership, the IRS lets people value their carried interest at zero for gift tax purposes if they meet certain technical rules.
For some reason I am reminded of this song:
Most Americans can't avoid paying taxes on gifts to their family members above $13,000 (for 2011). But as F. Scott Fitzgerald so famously wrote in his story "The Rich Boy" ''Let me tell you about the very rich. They are different from you and me.'' For one thing they can find ways to not pay taxes on $100 Million.
But Mitt is for the Middle Class, I hear, so I'm sure he'll change all that when he becomes President, right? Yeah, I'm sure he'll eliminate this tax dodge for all his hedge fund buddies who are funding his campaign.
Or maybe he'll just eliminate food stamps, Medicaid, and unemployment insurance and anything else that helps the "very poor" who sit around all day drinking expensive liquor and driving their Cadillacs all over town (at least they buy American). For the middle class' sake, of course. Whatever is left of it, that is.