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Getting ready to do your taxes? Me to, well mine, and everyone I know. Seeing increased MSM coverage about who is showing what, I had some time and wondered what Romney's taxes looked like (that he released).

Seeing more I used a few pay sites to find out what I could about Bain. Not surprisingly just names, although almost every is a Harvard MBA. So below I post some of the report I paid for, put together some other things I read or took from his 1040.

My hope would be as to the Bain connections people can elaborate or see other connections. And I hope talking about the ways he used his taxes is somewhat educatoinal. Note while I was 1st in lawschoo for biz orgs and tax, I am NOT a Tax attorney and this is not tax advice.

I imagine much of this has been discussed but it is interesting to read through the docs yourself and see how Romney has used tax laws to his favor. I would at least credit whoever does his taxes/financial planning that they are pretty astute.

In going through maybe I'll learn something, maybe you. But certainly not use his 1040 as a template unless you are a multi-millionaire.

First looking at everything and Romney's 1040:

Mitt Romney's 1040. I have (parts) of it from 2010. That is available hereThis is nothing that turbotax could ever do. Read when you run out of food labels to put you to sleep. Even I only glanced at it, but I think it was an interesting glance (lots of things left out and still over 200 pages I believe)

What I See From What is in 2010
1. What wages? lol
2. Great use of itemized deductions to probably avoid capital gains
3. Perfect example of using Capital gains over ordinary income (he made more capital gains paying 15% than anything else) (the tax bracket a family earning $34,000.00 would be in (basement of married-joint filing) rather than the 35% he should be, makes several millions of difference)
4. Interesting use of Trusts, and Offshore IRA's (perhaps genius to the extent legal).
5. Clear admission that he is basically a limited partner of Bain
6. We will never get much of his paper-work because it seems like it probably is hyper-technical uses loopholes and probably operates in a grey area. Anytime Cayman islands comes up you tend to get that.

1040 Nutshellish

He made 3.2 million in "wages" (some for his authoring career and public speaking)
12.5 Million in Capital Gains (taxed at 15% not ordinary income).
Overall about $20,000,000.00 in 2010 before deductions.

Not bad for a guy that is "retired". Except the fact of the matter is, as I see despite Bain's letter saying he left 13 years ago, he still holds an interest. Technically under tax law he is still a partner. Further in the 1040 he has a letter from 2010 regarding n 83(b) election regarding Bain and a Transfer to one of the Blind Trusts (someone sent on behalf of trust, not Romney). What an 83(b) letter (election) is is something that directs the IRS to tax the stock (usually) at the time of the grant (when it may be worth very little or when payment is made), minimizing potential tax. For example his letter goes on to state that the value of the transfer is $0.00 because the interest in future appreciation is subject to forfeiture "if I cease performing services for the Partnership". Hm. I thought that you didn't work for them? Why bother making an 83(b) election if you have nothing to do with them, other than to have no tax to pay ever on the property transferred when you do perform for them? What's more he it is identified as a partnership interest.

Don't know how you can have a partnership interest but not be a partner.

The truth is, it appears, Mr. Romney had negotiated his "retirement" agreement. Which looks like nothing more than becoming a "limited partner" which he admits in his taxes.He continues to be paid a part of the firm’s profits in buyout deals and other businesses, much as active partners were. The agreement would cover any new fund or venture started by his former partners until February 2009, although his stake would decline with each successive fund. He and his wife also would be permitted to invest their own money in co-investment vehicles typically reserved for Bain executives. (It has been reported in a few places basically re his 13 year "absence"). F

Some specifics of Mr. Romney’s holdings were revealed when, fresh off his successful stint running the Games, he entered the 2002 campaign for Massachusetts governor.
A disclosure form filed with the Massachusetts Ethics Commission, detailing the Romneys’ finances for the previous year, reported stakes ranging from 2.1 percent to 16.5 percent of the firm’s share of the profits in several Bain funds created before Mr. Romney left. After taking office in 2003, Mr. Romney moved the bulk of his assets into two blind trusts, according to his Massachusetts financial disclosures. Today, many of the family’s Bain assets appear to be held in Mrs. Romney’s blind trust. The 1999 retirement deal turned out to have a huge upside that few could have predicted: the golden age of private equity was just around the corner
NYT December 18, 2011. Let's play with that for a moment. Now getting 2.1% to 16.5% is a pretty great deal for having nothing to do with a Company that is a giant. Take the Conservative 2.1%.

About a Month ago Bain released a letter distancing themselves from Mitt. While patting themselves on the back:

As highlighted in our year-end letter, 2011 was a productive year for our global private equity business, with our funds generating $4.1 billion in realizations. Thanks to strong underlying company results, we were able to harvest a portion of the value we have worked hard to build during the past several years. Over half of the proceeds came from public stock sales, for which our weighted average multiple of money was 3.1x our cost basis. In 2011, we also committed $3.6 billion to nine new investments. As a
result of our global reach, we continued to find opportunities in developing economies and value in the developed markets, particularly where transactional complexity or difficult turnaround situations offered high upside potential. Coming off a strong rebound in 2010 following the recession, our global private equity portfolio continued its growth trajectory, with over 7 percent overall revenue gains in 2011. We are optimistic about liquidity and investment prospects in 2012, particularly given the positive backdrop of the capital markets during the first two months of this year. On the new deal side for 2012, we are focused on opportunities where our integrated global
Now without having his "pension" plan it is hard to play with this. But say it is such that he is getting just 1% of that 4 billion number (hypo as unclear his plan, if he invested more money as he'd have to have a taxable loss or gain (which we could see below from his 1040 if it is a bain affiliated company- that is not clear that is Profit, you could have 5 billion in revenue and 6 billion in liabilities and be in the red. But for fun, let's say it is realized capital gain. What is 1%? I highly doubt it is so straight for-ward but why not?

That would be Forty Million Dollars. Not necessarily of course in taxable gain. Not bad.

So who has he said in 2010 that he earned Long term Capital gains from? (Note: I did not look into connections to bain, or look through all of the dozens of declarations of the trust)

He claimed to have 12.5 million in Capital Gains. Taxed at 15%- 1,875,000.00 in taxes.

Easy to see why Republicans love their Long Term Capital gains.

If he filed at ordinary income, in 2010, he would be at the Married filing Jointly 373,000+ range. That tax is 35%.
That would be 4,375,000.00. So being rich and waiting a year on an investment makes pretty sound financial planning advice for those 1%'ers. Otherwise old Mitt would have paid about $2,000,000.00 + MORE.

And don't let this fool you about your IRA. Most Americans do not buy and sell stocks every year. Your IRA might. But this is totally different. This is you have an extra $100,000.00 buy Ford when it was a dollar, then sell it at 12.00. That 1.1 million you made if "long-term" isn't taxed as ordinary income it is only 15%. Why? Because if you were taxed at 35% you wouldn't have wanted to invest to make money? Allegedly.


much of his wealth has migrated into investments outside the company or into family trusts, including an additional $100 million set aside for his five sons. But the family’s Bain holdings are still considerable: in his 2011 disclosure, Mr. Romney reported Bain assets between $12.4 million and $60.9 million, which provided between $1.5 million and $9.3 million in income. The blind trust for his wife, Ann, held at least another $10 million, generating income of at least $4.1 million. Because the campaign is required to provide only a minimum value for some Bain assets now held by Mrs. Romney, the total could be far more.

Mitt dies, that does not go through probate (saving you about 10% in costs/fees etc if just bequeathed by will). You will never see any of his multiple trusts. They are 100% private, only a declaration to act under one if he owns a house in trust. Not the doc. Good way to say I earned only 3 million, the trusts for my kids idk. Well we do, and it is a lot more. Same with his IRAs. He probably is worth over 100 million easily. But showing a 1040 where he had 18 million I suppose is a lot better than showing what is really going on right near the beach. Trusts are of course also coveted for their privacy. Good luck getting your hands on the Blind Trust that appears to be the primary vehicle for his Bain connection er non connection.

You have the following:
So this is not the worth, this would be the amounts earned (appreciated it seems). As in if I bought Apple at a dollar in the 80's I don't declare it on my taxes until I sell for a gain. As in for a capital gain I don't incur tax (except on dividends in certain scenarios) until I sell and get back more than I paid for (one exception I can think of is if it was inherited and went through probate, say your mom's house is worth 100,000.00. If she dies and it gets left to you. The "exchange" for the taxes was that people like you get "stepped up costs basis". In other words if she bought it in 1930. Never took depreciation, assume a residence. Now fair market value is 100,000. You sell after probated for 100,000.00 the govt lets you use that and not the 10,000 from 1930 as a cost basis. If say she sold the day before she died. She'd use her cost basis of 10,000.00 and would have a $90,000.00 long-term capital gain. Or if you want to get really complicated. If you and she went to an attorney to plan her estate. She quit claimed half her interest with a right of survivorship and died. You sell the house (assuming everything stays the same). You are going to get a $45,000.00 capital gain. Why? You get "stepped up" for half the home. So the cost basis in her half is $50,000.00. But, you owned half, you have her "carry-over" basis, so half of what she paid or 5,000.  For that half the FMV and what you got exceeded by 45,000.00 and because you are alive and owned it no stepped up basis). I had a family friend ask me about that, hopefully you take something from this diary, again consult qualified tax attorney, I could be wrong.

 I would assume then that all of these are just 2010's gains.

The Ann And Mitt Romney 1995 Family Trust- 1.5 million
The Ann D. Romney Blind Trust- 3 million
The W. Mitt Romney Blind Trust- .5 million.
And a few others.
Again taxed as Capital gains undoubtedly.

Getting back to his 1040 he did not take the standard deduction we all will (something like $4,000.00 in 2010, looks like over $5,000.00 for 2011) come this week. In 2010 he chose to Itemize his deductions. Will 99% of Americans ever do so, maybe some, but usually you will not have (unless self-employed) more in itemized deductions than the Standard.
1 million for state/local taxes.
Some amount for Health Care that didn't qualify (gotta be nice to be able to pay 30 grand on your health and it not even be enough to meet the 2% floor to deduct)
51,000.00? for interest he paid on a mortgage? That one is a little bit strange to me.

And 3 million in Charitable Contributions.

Charitable Contributions- Does that make him such a great guy? Not necessarily.

If he did not contribute he would not get the itemized deduction. What is the difference? Well at his level big. Normally we don't donate more than the standard deduction to Charity. So it doesn't really matter as we take the standard deduction. Not so In Mitt's return (2010). Ie if we have itemized deductions totalling $500.00 they might be included on our 1040, but don't matter as we are better off taking the "standard deduction". But if your itemized deductions are going to far exceed or you can make them far exceed the standard deduction, you are better off, Like Mitt. Ironically despite their human qualities I note that there is nothing indicating a deduction for Corporations as dependents/joke

He claims $21,646,507.00 in "Adjusted Gross Income" ("AGI" not what is taxed yet basically what you made with some adjustments, before you take your deductions then you get "Taxable Income" and your tax). You get to Taxable Income after getting AGI and subtracting the standard deduction, or taking the time to do itemized deductions. The later probably saved a few million. Well not probably did. In two ways it seems as at least half was NOT money.

Charitable donations (Schedule A, lines 15-18) are deductible only to the extent that your total contributions are less than 50% of your adjusted gross income. His AGI is 21 million, 3 million is less.

If you donate stocks, bonds, works of art, or other assets on which you would have paid capital gains tax, your contribution is limited to 30% of your adjusted gross income. Comes as no surprise that Mitt's 3 Million is less. No carry over for next year. So he is charitable to the extent it does reduce that "taxable income" number. But doesn't like charity so much that it doesn't help his Taxable income this year to go over 30% of AGI.

So Mitt Could have contributed that 3 million as Stock (or a variety of other investments) that let's say 1 million was Capital Gains. He otherwise would have paid 15% on it. Let's work with smaller numbers to show how he basically decreased his taxes twice by this large Charitable heart which I have to guess is what happened as he did not donate all cash. Over 1.5 in non-cash. Makes him a winner 2x.

Say his AGI was 30,000.00. His charitable deduction could be up to $15,000.00 (50%). Or $9,000.00 (30%) in stocks bonds, etc, that are tax deductible. Let's say Mitt donates $10,000.00 of appreciated stock in kind to charity (He bought at 1,000.00. it is now 10,000.00 he'd have 9,000.00 if he kept as capital gains taxed). Or he could donate. If he does he would take an itemized deduction of 9,000.00, AND carry the other 1,000 forward for next year (up to 5). He not only increased his itemized deduction (lowering his taxable income this year) but also avoided any capital gains tax on the stocks (donating at FMV and not paying capital gains), reducing taxes twice in one generous donation.

It would appear that is what he did based on Schedule A Line 17. (which refers to something else re non cash donated). Assuming that it was appreciated stock, worth 1,000,000.00 more, Mitt Just avoided paying $150,000.00 in capital gains and reduced his overall AGI by the FMV of what was donated.

 let's talk about the Cayman's (which Mr. Romney does not like to).

Reports of the WSJ on Jan 12, 2012 stated:

Mitt Romney’s campaign [claim] his holdings in the Cayman Islands and elsewhere have no effect on the amount he pays in U.S. taxes.

As The Wall Street Journal reported in Thursday’s paper, many of Mr. Romney’s offshore investments are held through his individual retirement account, which has grown to between $20.7 million and $101.6 million. IRAs are tax-deferred accounts, in which earnings accrue tax-free until the money is withdrawn during retirement.
Problem. Probably . . . not  . . . true. Some of the offshore holdings are likely intended to help Mr. Romney avoid paying an obscure but hefty tax of as much as 35% on some of those investments, held in a tax-deferred retirement account (aka IRA, Roth IRA, etc.)

The thing is that had Mitt’s IRA invested in Bain funds in the U.S., he would likely have been forced to pay an obscure levy called the “unrelated business income tax,” also known as UBIT.
This tax, assessed for individuals at a maximum 35% rate, is meant to discourage tax-exempt entities such as an IRA or college endowment fund from unfairly competing with for-profit, taxpaying entities by operating a business without paying taxes on it. Does mitt care? He's like the Honey Badger of paying what he probably should it seems.

Investing in a partnership such as a Bain Capital fund that uses debt to buy companies
would trigger the tax. For this reason, the experts said, it is very common for private-equity funds such as Bain to set up vehicles in offshore locales such as the Cayman Islands. Such a structure allows American tax-exempt entities, including IRAs, to avoid paying UBIT.

Example in smaller scale:

Say ABC University’s ballroom is periodically rented to the general public for private activities such as wedding receptions and other private events. Does it pay UBIT?
       Trade or Business?     Yes
      Regularly Carried On?     Yes
      Not Substantially Related?     Yes
        Exception:     Yes (Rental income from real estate)
        Subject to UBIT?     No

But say ABC University's Student Recreation Center sells memberships to the general public/ Alumni.
       Trade or Business?     Yes
      Regularly Carried On?     Yes
      Not Substantially Related?     Yes
           Exception:     No
           Subject to UBIT?     Yes

They are both not related to the exempt purpose of being a university. The second though has no exemption so is taxed, and penalized in a way to make it more fair on say Mom and Pop's gym down the street for who everything is probably taxable income.

A significant source of capital for venture capital and other private equity funds is pension plans, individual retirement accounts, foundations, and endowments. These are all tax-exempt entities under the Internal Revenue Code. Tax-exempt organizations, including “qualified” pension plans, individual retirement accounts, foundations, and endowments, are subject to “unrelated business income tax” (UBIT) on their “unrelated business taxable income,” often referred to as UBTI. In connection with their investments in private investment funds, many tax-exempt investors seek to avoid or limit the funds’ generation of UBTI.

Bain as stated before uses Debt to finance acquisitions and make $. So how would this have anything to do with Mitt's IRA?

 Debt-Financed Property Notwithstanding the general rule, UBTI includes a percentage of any income not otherwise treated as UBTI that is derived from property subject to “acquisition indebtedness.” Very generally, the percentage of income that is treated as debt-financed is the percentage of the acquisition cost that is financed by borrowed funds. Thus, if one-half of the purchase price of an asset is borrowed, then generally speaking one-half of the income from the asset may be treated as UBTI. So 1 dollar of Mitt's IRA is directed to Bain, usually 1/2 of what they make after ruining the company they acquire (it seems) would be UBTI. Let's say 10 dollars, 5 dollars would be subject to UBTI. The gov't doesn't like you doing that as it is unfair to others, so the tax is a disincentive.

Acquisition indebtedness includes the amount of any indebtedness to which property is subject at the time of its acquisition, and debt incurred after the acquisition of property if the debt would not have been incurred but for the acquisition and the incurrence of the debt was reasonably foreseeable at the time of acquisition. In some circumstances where the credit is advanced based on the financial strength of the guarantor rather than the borrower, a loan guarantee by a fund can be viewed for federal income tax purposes as a borrowing by the fund.
Indebtedness incurred by a partnership or limited liability company of which a tax-exempt organization is a member can create acquisition indebtedness for the limited partner or member. However, debt incurred by a corporation is not viewed as debt incurred by a shareholder for this purpose.
So if "experts" are right. By funding debt from the Cayman's then acquiring U.S. assets they apparently are utilizing some law/credit, etc. and everyone wins except U.S. taxpayers. It would be interesting to see if at the expense of U.S. businesses Bain/Romney and his tax-exempt funds- are paying the Caymans. You'd at least think he'd have the decency to do it in the U.S. Would love to see a statistician overview of jobs lost by Bain's acquisitions v. money saved by this whole set up.

Of course this part is apparently debatable? And we don't know. This is what we will never get.

Oh, and  he received a tax refund of 1.6 million dollars (in 2010 when it was all said and done).

Other than that, well including that I'd call it all rather boring.

What'd I get for paying for Bain's Profile?

Not much. But for those better than me have at what Hoover's knows (note most all of the below is from 1. a Hoovers generated report available online from 50.00 or 2. from Bain's website and some from other financial sites):

Company Overview:
111 Huntington Ave.
Boston, MA 02199 United States
Phone : 617-516-2000
Fax : 617-516-2010
If you want to make a big deal out of it, chances are Bain Capital will get involved. The private equity and venture capital investor acquires and owns interests in companies in the business services, retail and consumer products, communications, health care, hospitality, and technology sectors. The firm has made private equity investments in more than 250 companies since its 1984 founding. Its diverse portfolio currently includes stakes in such well-known companies as American Standard, Burlington Coat Factory, Clear Channel Communications, Dunkin' Brands, SunGard Data Systems, Warner Music Group, The Weather Channel, and HD Supply, the former wholesale construction supply business of The Home Depot.
Key Information

DUNS Number 199882911
Location Type Headquarters
Subsidiary Status No
Manufacturer No
Company Type Private
Plant/Facility Size (sq. ft.) 3,000.00
Owns/Rents Rents
Foreign Trade Imports / Exports
Accountant PricewaterhouseCoopers
Total Employees 49,000
1-Year Employee Growth 0.00%
Employees At This Location 500
Year of Founding or Change in Control 1984
Primary Industry 1312:Investment Firms
Primary SIC Code 67190000:Holding companies, nec
Primary NAICS Code 55111:Management of Companies and Enterprises
Latitude/Longitude 42.346255 / -71.08095
Key Financials
Fiscal Year-End December
Prescreen Score Low Risk


HD Supply
Air Medical Group Holdings    
Hero Investments
AMC Entertainment    
Applied Systems    
Ideal Standard
Bellsystem24     I
nternational Market Centers
Bombardier Recreational Products    
JinSheng International
Brakes Group    
Lilliput Kidswear
MEI Group
Bright Horizons    
MichaelsBroder Bros., Co.    
Burlington Coat Factory    
Casda Biomaterials    
OSI Restaurant Partners
China Fire and Security Group, Inc.    
Securitas Direct
Clear Channel Communications    
Sensata Technologies
Sinomedia Holding Limited
CRC Health Group    
Cumulus Media    
D&M Holdings    
Domino's Pizza Japan    
Dunkin' Brands    
EPOCH Holdings    
Suzhou HiPro Polymers
The Weather Channel
Toys "R" Us
Guitar Center    
Village Ventures
H3C Video Surveillance     Warner Chilcott

Key People:
Mr. Joshua Bekenstein Founder and Managing Director
Mr. Mike Goss Managing Director and COO
Mr. David (Dave) Hamilton SVP Information Technology
Mr. Jay Corrigan CFO, Private Equity
Mr. Jeffrey (Jeff) Hawkins Managing Director and COO, Sankaty Advisors
Mr. Jonathan Lavine Managing Director and Chief Investment Officer, Sankaty Advisors
Mr. Brian Murphy Operating Partner
Mr. Laki Nomicos
Mr. Marc Valentiny
Mr. James S. Athanasoulas EVP, Sankaty Advisors
Employees: For someone else's sake who likes connecting dots:
Founder and Managing Director Mr. Joshua Bekenstein 53
Managing Director and COO Mr. Mike Goss
SVP Information Technology Mr. David (Dave) Hamilton
CFO, Private Equity Mr. Jay Corrigan
Managing Director and COO, Sankaty Mr. Jeffrey (Jeff) Hawkins
Managing Director and Chief Mr. Jonathan Lavine
Investment Officer, Sankaty
Operating Partner Mr. Brian Murphy
Operating Partner Mr. Laki Nomicos
Operating Partner Mr. Marc Valentiny
EVP, Sankaty Advisors Mr. James S. Athanasoulas
EVP, Sankaty Advisors Mr. Andrew Carlino
EVP, Sankaty Advisors Mr. Robert Cunjak
Managing Director, Sankaty Advisors Ms. Kimberly Harris
EVP Mr. Mark Hill
EVP, Sankaty Advisors Ms. Viva Hyatt
Portfolio Manager, CLO, Sankaty Ms. Susan Lynch
EVP, Sankaty Advisors Mr. Gauthier Reymondier
Managing Director Mr. Jeffrey Robinson
Managing Director, Sankaty Advisors Mr. Robert Weiss
SVP Tax Planning and Compliance Mr. James Boudreau
SVP Ms. Susan Lock
SVP Administration Ms. Karen McKenzie
Managing Director, Venture Capital Mr. Ajay Agarwal
Managing Director Mr. Richard (Bear) Albright
Managing Director Mr. Dewey Awad
Managing Director Mr. Andrew B. Balson 45
Mr. Steven W. (Steve)
Managing Director 51
Managing Director, Sankaty Advisors Mr. Tim Barns
Managing Director Ms. Melissa Bethell 35
Managing Director, Sankaty Mr. Michael Bevacqua
Director Partner Investments Mr. Colin Campbell
Managing Director Brookside Fund Mr. Phillip Carter
Managing Director, Mumbai Mr. Amit Chandra
Mr. John P. (JC)
Managing Director 46
Managing Director Mr. Todd M. Cook 40
Managing Director Mr. Jeffrey R. (Jeff) Crisan 38
Managing Director, Sankaty Advisors Mr. Stuart Davies
Managing Director, Sankaty Advisors Mr. Jonathon DeSimone
Managing Director and General Mr. Sean Doherty
Managing Director Mr. Paul Edgerley
Managing Director, Sankaty Advisors Mr. Michael Ewald
Managing Director Mr. Domenic Ferrante
Managing Director Mr. Scott C. Friend
Managing Director Mr. Jeffrey Glass
Managing Director Brookside Fund Mr. Dennis G. Goldstein
Managing Director Mr. Jonathan Goodman
Managing Director Mr. Chris Gordon
Managing Director Mr. Blair E. Hendrix 46
Managing Director Mr. Jordan Hitch 44
Managing Director, Sankaty Advisors Mr. James Kellogg
Biographies of all.

But here are some more interesting ones: as it would be 30 pages for all-
First some trends
It is hard to say you are blue collar with friends like these. There are 32 profiles for these individuals. I Count:
20 Harvard MBA's
2 Yale
3 Princeton
5 Stanford
3 Cornell
2 Brown

Joshua Bekenstein, Age 53
Current Company Titles
Unknown - Present : Founder and Managing Director
Other Company Affiliations
Director, Toys ''R'' Us, Inc.
Director, Michaels Stores, Inc.
Director, Burlington Coat Factory Warehouse Corporation
Director, Waters Corporation
Director, Dollarama Inc.
Past Company Affiliations
Director, Shoppers Drug Mart Corporation
Director, Sealy Corporation
Director, Bright Horizons Family Solutions LLC
Source : Company Web Site, 2010
Experience: Mr. Bekenstein joined Bain Capital at its inception in 1984. He has been a Managing Director since 1986. Prior to joining Bain Capital, Mr. Bekenstein spent several years at Bain & Company where he was involved with companies in a variety of industries. Education: Mr. Bekenstein received an MBA from Harvard Business School and a BA from Yale University
James Boudreau
Current Company Titles
Unknown - Present : SVP Tax Planning and Compliance
Source : Company Web Site, 2010
Experience: Mr. Boudreau joined Bain Capital in 2001 and is the Senior Vice President of TaxPlanning and Compliance. Prior to joining Bain Capital, Mr. Boudreau was Vice President of Tax with The Learning Company Inc. (Mattel, Inc.). Earlier in his career, Mr. Boudreau held various positions within the Tax Department of Wang Laboratories, Inc. Mr. Boudreau received an MST from Bentley College and is a Certified Public Accountant. Education: Mr. Boudreau received a BA from Northeastern University.
Susan Lock
Current Company Titles
Unknown - Present : SVP
Source : Company Web Site, 2010
Experience: Ms. Lock joined Bain Capital in 1996. Prior to joining Bain Capital, Ms. Lock spent 6 years at Arthur Andersen where she was a Manager in the technology/small business group. Education: Ms. Lock received a BS from Northeastern University and is a Certified Public Accountant.
Steven W. (Steve) Barnes, Age 51
Title held since 2000 : Managing Director
Current Company Titles
2000 - Present : Managing Director
Other Company Affiliations
866-541-3770 • HOOVERS.COM Apr 06, 2012 • PAGE 14
Director, CC Media Holdings, Inc.
Director, Clear Channel Communications, Inc.
Director, CRC Health Group Inc.
Past Company Affiliations
Director, Sealy Corporation
Director, Accellent Inc.
Director, Supervisory Board, Corporate Express NV
Source : Company Web Site, 2010
Experience: Mr. Barnes has been associated with Bain Capital since 1988 and has been a Managing Director since 2000. In addition to working for Bain Capital, Mr. Barnes has also held senior operating roles of several Bain Capital portfolio companies including Chief Executive Officer of Dade Behring, Inc., President of Executone Business Systems, Inc., and President of Holson Burnes Group, Inc. Prior to 1988, Barnes held several senior management positions in the Mergers & Acquisitions Support Group of PriceWaterhouseCoopers. Education: Mr. Barnes received a BS from Syracuse University and is a Certified Public Accountant.
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Comment Preferences

  •  Cleveland Attorney - a fellow Kossack (2+ / 0-)

    and now Cleveland tax attorney, johnny wurster, has written a few diaries on Romney's taxes. You would likely find them of interest.

    "let's talk about that"

    by VClib on Tue Apr 10, 2012 at 10:19:00 AM PDT

    •  I'm not practicing here, but I'll keep (2+ / 0-)
      Recommended by:
      VClib, ClevelandAttorney

      my fingers in the tax world to a certain extent.  

      Here to chime in on the 83b stuff.  The language about performing services comes straight from a safe harbor announced in Rev Procedure 93-27 and amplified in Rev Procedure 2001-43 (pdf), in which the IRS notes it won't contest zero valuations of carried interests when substantial services have yet to be done.  IOW, this is "magical language" that tax lawyers use to ensure that they're w/in that safe harbor.  

      So that's a bit sketchy, since it's a veritable certainty that they're not performing additional services, but at the same time this may be harmless error (or harmless fraud!): I don't think that the service part of the safe harbor test would be determinative under the relevant case law.

      re: IRA and Caymans: yes, it avoids UBIT, but the IRS has blessed the use of offshore blocker corps (which are the entities through which the IRA would invest) through a revenue ruling (or procedure, can't recall which).

      Finally, I'll note that the only thing I found that may be of real interest is his Cayman Islands CFC.  Before 2008, hedge funds would use those to defer receipt of the carried interest (in hedge funds, though, these would be contractual rights to the carry, called the incentive fee, rather than an actual partnership interests for reasons that I won't get into here).  In order for the deferral to work, it had to be funneled through an offshore corp.  This technique was ended in 2008 w/ the passage of 457A, but taxpayers were given until 2017 to wind them down.  So it could be a residual incentive fee.  The only thing that makes me think that's not what's going on here is that a private equity fund would never use them, since deferral can only be had by converting investment income into contractual income, which is taxed as ordinary income at the top marginal rates.  If Bain had a fund that bought mezz debt or something, though, then it becomes more plausible.

      •  Thanks (1+ / 0-)
        Recommended by:
        johnny wurster

        I was not trying to say what he had done was illegal. He just knows how to play the game. And does so well. I'll have to re-read what you said. We are talking about taxes.

        •  I [heart] taxes! (0+ / 0-)

          Fun stuff.

          As a new OH resident (well, grew up here, but haven't lived here in a dozen years), I had occasion to look at the OH statutory resident rules, and I've gotta say: they're totally insane.  

          If the rest of OH tax law is as insane, it'll be some interesting work.

          •  So you've left NYC? n/t (0+ / 0-)

            But nobody's buying flowers from the flower lady.

            by Rich in PA on Tue Apr 10, 2012 at 04:55:22 PM PDT

            [ Parent ]

          •  PM me if you want to know (0+ / 0-)

            anything. I have never been at a firm that had malpractice insurance for tax law. But I did concentrate in it.

            If you are in commercial law in any way, what you'll find most insane in OH is that we still allow Cognovit Promissory Notes (commercial).

            Taxes, I can only think that the way RITA is set up is bad.

            If you just moved here, and bought a house make sure you hold onto your HUD statement, P/A etc, as no houses near Cleveland (if that's where you're at) are going for what the auditor taxes.

            Although the Cuyahoga County (Cleveland's county) Board of Revision, unlike the surrounding counties refuses to recognize that a transaction with a bank who foreclosed on a party is "arm's length". When you challenge the taxable value, which is complete and utter B.S.

            I covered a bunch of random things I know.

            •  Property tax (0+ / 0-)

              For tax year 2012 say auditor values your house at 100k. Your assessed value is 35k. You bought for 50k. You have to ask for a reduction for tax year 2012 during a very specific time period (before April 2, 2013). I just filed like 50 in Lake County for last year. The auditors are out of touch.

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