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       Mitt Romney is a piece of work, that's for sure.

        I don't like having to "guess" how Romney amassed $100 Million in his IRA, just like I don't like having to "guess" what the details are in Romney's Tax Policy Plan, or what the details are in Romney's Foreign Policy plan, or what the details are in any other policy Romney claims to have.  But because Romney will only discuss those things in private, quiet rooms, "We the People" have no choice but to "guess" what the details in Romney's policies would be and "guess" how Romney acquired $100 Million Dollars in his IRA.

      Mitt Romney's 2010 Tax Returns are missing Form 990T and why that is important.  

      Let's be clear, there is no way in hell, under any legal, accounting scenario that Romney's IRA could have accumulated $100 Million Dollars without Romney's IRA engaging in Commercial activity.

      The question then becomes, how much money did Romney's IRA pay in Unrelated Business Income Tax on the Millions of dollars in income Mitt's IRA earned from the commercial activity his IRA was obviously engaged in?

      The only way to know the answer to that question, is to review the Unrelated Business Income Tax (UBIT), Form 990T, Romney's IRA would have been legally compelled to file with the IRS.  

      When an individual's IRA has to pay the UBIT, the Fiduciary, or Trustee, of the individual's IRA pays the tax and files Form 990T with the IRS.  Like an individual's K-1, w-2 etc., the Trustee of the IRA sends Form 990T to the individual IRA holder, in this case Romney, and the individual attaches Form 990T to the Individual's Form 1040 and all accompanying Schedules.

      Since Romney's IRA did not file a Form 990T, we are left to "guess" Romney's IRA paid zero taxes on the Millions of dollars of income his IRA earned as it engaged in Commercial activity.

       We know Romney's IRA has Bain funds in it.  Bain private equity Funds are listed in the assets of Romney's IRA and those Bain Funds are located in the Cayman Islands.

     If Romney's IRA held those funds directly, instead of through a "Blocker Corporation", a 990-T would have been filed. If it [Romney's IRA] has Unrelated Business Income, then, by U.S. law it has to pay the Unrelated Business Income Tax and a 990-T would need to have been filed.

      The questions then become, how and why did Romney's IRA avoid paying U.S. Unrelated Business Income Tax on the income his IRA earned while it was engaged in Commercial activity?

     The answer to "how" is simple, Romney's IRA funds are held by a Foreign Country's "Blocker Corporation" as a Tax Shelter in order to shield the Millions of dollars in income earned in Mitt's IRA from Taxation in America.

      The answer to "why" is unclear to me.  

      Oh sure, no one really likes or enjoys writing checks to the IRS because it is painful.  But, We the People know that, among other things, Taxes pay America's Debt on Two Wars and Tax money is used to provide our Troops, who are fighting the enemy overseas, with state-of-the-art: body-armor, tanks, weapons, boots, food, intel, communications, air power, naval power, ground power etc., so we pay our Taxes with a bitter-sweet emotion.  

     In short, We the People know that people who use Foreign Tax Shelters to avoid paying U.S. Taxes are directly harming our Troops and forcing America to go further in Debt to China.

     One would think a candidate for President of the United States would discourage people from stashing their income in Foreign Tax Shelters as a candidate for President would understand and realize the importance of that Revenue - Revenue which provides America's Troops with stellar equipment, pays America's Debt on Two Wars and keeps America strong and as exceptional as possible.

     Romney wants to be President of the United States - is it possible no one ever told Romney "what" Taxes pay for?

     Sadly, the Bush/Cheney Administration failed to realize "what" Taxes pay for, so George W. Bush, Dick Cheney, Bush/Cheney Military Advisers and Bush/Cheney Economic Advisers all decided it was in America's best National Security interest to borrow money from China to pay for our two wars and keep our Troops equipped.

      Hey, didn't Romney hire the Bush/Cheney Military Advisers and Economic Advisers?  Yeah, he did!  Romney did hire Bush/Cheney's failed Military Advisers and failed Economic Advisers.

      Go figure.

7:18 PM PT:     I appreciate all the very valuable, insightful comments.

    The most important thing to note in the comments: Romney refuses to give details so "We the People" can only "guess" what scheme Romney used to accumulate $100 Million Dollars in his IRA --

     Thus, the bottom line with Romney is always the same, we are left "guessing" because Romney refuses to give details on every single issue, including but not limited to, how Mitt amassed $100 Million Dollars in an IRA.

   
     Just like all things Romney, "We the People" are left "guessing" what the details are in Romney's Tax Policy Plan, and what the details are in Romney's Foreign Policy plan, or what the details are in any other policy Romney claims to have.  

     Because Romney will only discuss those things in private, quiet rooms, "We the People" have no choice but to "guess" what the details in Romney's Policies would be and "guess" how Romney acquired $100 Million Dollars in his IRA.


Originally posted to cc on Sun Aug 19, 2012 at 10:21 AM PDT.

Also republished by Community Spotlight.

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Comment Preferences

  •  It is possible he maxed out his 401 (k) (10+ / 0-)

    In 1987 maximum tax deferred annual contributions was $7,000. Today they are $14,000.

    If his company Bain Capitol matched contributions making that $14,000. $49,000 today.

    Plus I'm sure he was maxing out his IRA

    If he was putting privately held shares (which we know he was the sole shareholder) he could have undervalued the shares.

    Furthermore, it is possible to put more into a  IRA or 401(k) than the limit. You just don't get to write off the contributions over the limit on your taxes.

    At some point after officially leaving Bain in the 2000's I'm sure he rolled over the 401 (k) to his IRA.

    All is speculation until he releases his Tax Returns. Even if he released 12 years... it still would show what he did in the 80's.

    Romney/Rove 2012: If you liked Bush's Brain... you'll love Romney's.

    by jethrock on Sun Aug 19, 2012 at 10:50:42 AM PDT

    •  Exactly. He created Bain Capital... (13+ / 0-)

      Remember there are several versions of Bain Capital like entities, INC. LLC...  With each new corp. he could have put a ton of stock in his IRA with almost no value, fully knowing he could transfer good deals into these companies, making them worth a lot.  Now his ton of stock is worth a lot and he exercises the options.

      This is really how they do this crap.  Create company after company, with some designed for profits and others designed for losses.

      And we haven't even begun to look at those bogus blind trusts that him and Ann have.

      •  So if I've got this right, here's how I do it. (5+ / 0-)

        1. Create an IRA put $6000 in it.

        3. Have a trusted person create an LLC. Let's call it IgotMine, LLC.  Initial holdings: zero.

        4. Direct my IRA account manager to buy IgotMine, LLC for $6000.

        5. Refuse to take any severance money from my company, and instead direct my company to invest in IgotMine, LLC.

        6. IgotMine, LLC pays its taxes like any good company, and when the dust settles, it's still worth, oh in round figures, about $100 million.

        'zat about right?

        •  And when the withdrawals begin they are (1+ / 0-)
          Recommended by:
          Amber6541

          taxed as income.

          Romney is George W. Bush without brains.

          by thestructureguy on Sun Aug 19, 2012 at 08:36:12 PM PDT

          [ Parent ]

          •  Not if the IRA is held in a Foriegn Tax Haven (0+ / 0-)
            •  An IRA is a creature of the USA not a world (1+ / 0-)
              Recommended by:
              jfromga

              retirement program. If you claim you have an IRA you have to provide all the documentation. No such thing as having an IRA and hiding money or income in it. Legally.  The issue is whether to IRA meets IRS standards and so far, as far as we know, it has.  Whether there were disallowances and then interest and penalties we don't know. At the worst there were civil penalties which is not uncommon with complicated arrangements.  But nothing criminal.  The guy takes advantage of every loophole he can find.  Problem is not using the loopholes the problem is having them.  

              Romney is George W. Bush without brains.

              by thestructureguy on Mon Aug 20, 2012 at 07:10:17 AM PDT

              [ Parent ]

              •  His IRA is actually very POOR tax planning (0+ / 0-)

                He and his heirs are going to pay far more taxes because of this IRA than if he had not set it up.

                He has a $100MM IRA.  That's almost certainly because of capital gains and maybe dividends - you don't make $100MM on interest.

                Consider two scenarios:

                1. I put $100,000 pre-tax in an IRA, grow it to $100MM (factor of 1,000) and then take out the money in regular distributions

                2.  I invest $100,000 post tax, pay regular taxes on it, then grow it to $100MM.

                In the first case, there is no capital gains tax (it is in an IRA) but when you reach retirement age you have to take regular taxable distributions of multiple millions per year.  There is no way to avoid having this taxed at the top rate except to give it away so you pay $35MM in tax leaving you with $65MM post tax (at these income levels lower tax brackets are a rounding error).  Even if you die young your heirs will be taxed on their distributions from the IRA and will be paying at this rate.

                In the second case, even if you are in the top rate, you pay $53,846 on pre-tax income of $153,846 leaving you with $100,000.  Then you pay 15% capital gains tax rate leaving you with $85MM.

                It seems obvious that the second option is best.

                Either these guys screwed up big time or they had no idea they would be as successful as they were so they did not do tax planning on that basis.

            •  Not true (0+ / 0-)

              At age 70 1/2 you are required to start taking distributions (assuming it's a traditional IRA not a Roth) -- and those distributions get taxed as ordinary income, regardless of where the IRA is being held. In other words, unlike a corporation, you cannot postpone indefinitely repatriating the money -- that's part of the deal in setting up IRAs. AND the tax rate is the ordinary income rate, NOT the ultra-low capital gains rate.

              So unless he's got some additional tricks up his sleeve, like making a special tax loophole for people repatriating capital gains-heavy IRAs from the Caymen Islands, this may not turn out to be the brightest move.

              That's assuming all your speculation is true.

    •  Employer Contribution is Currently 50k (8+ / 0-)

      An Employee can put in up to 14k and the employer can put in up to 50k or 100% of salary - whichever is lower.

      My spouse and I have a two person S-Corp. The first few years we were making the 401k contributions on our wages which meant we paid SS on it. We didn't realize that we could just make all of the contributions directly out of the corporate accounts side and not pay taxes on the contributions. Since we have to pay both the employee and employer side of SS and Medicare on wages this really helps. We are continually learning about little tricks to save on taxes that are available to corporations. However since are receipts are very modest, we never go anywhere near the limits enjoyed by larger companies.

  •  It is a mistake to think insanity is indicated (3+ / 0-)
    Recommended by:
    cotterperson, Chi, Tam in CA

    by people doing the same thing over and over and expecting different results.  Instinct-driven people do things over and over because they don't expect. They just act out of habit.

    Willard's forte = "catch 'n' cage". He's not into "catch and release."

    by hannah on Sun Aug 19, 2012 at 10:51:19 AM PDT

  •  You could be right (5+ / 0-)

    and it might even be worse from my rec'd diary on this from last week.

  •  Romney prefers to invest in foreign countries (10+ / 0-)

    instead of America's future.

  •  Something Horrendous in those Taxes (19+ / 0-)

    Mitt really got riled by the Harry Reid charge of zero taxes paid --it almost smoked him out to release more taxes.  But the political calculation would seem to have been---"well, that's pretty bad charge but we can weather that or neutralize it somewhat better than actually showing what's really, really horrendous in those taxes."   Besides getting to the bottom of whatever UBIT might or might not have been paid would also be to determine what was the actual business(es) being engaged in offshore.  There are alot of high margin, lucrative businesses that might legally be engaged in offshore that one could not do here in the states.  One can only guess what those activities might be as long as Romney will not release the full detail for 2010 or any information on earlier years.  Ann and Mitt have already started to create a cover for themselves by referring to the Blind Trust that was formed many years ago, saying with respect to it---"Why I don't even know what's in there or what they're doing."

  •  this is a very clear explanation of (5+ / 0-)

    complicated tax minutiaie

    "I'm sculpting now. Landscapes mostly." ~ Yogi Bear

    by eXtina on Sun Aug 19, 2012 at 12:47:45 PM PDT

  •  I would bet (3+ / 0-)
    Recommended by:
    gfre, TexMex, Amber6541

    Romney doesn't know what the hell he's paid in taxes or steps "he"'s taken to avoid them.  Tax laws are so damn complicated I myself with rather straight-forward investments can hardly cope with the process.  Someone like Romney with "real" money has financial advisors, accountants, tax lawyers etc. to manage his vast wealth.  

    •  well, he may not know much, but he knows (5+ / 0-)

      he pays someone -- or a lot of someones -- a lot of money to take advantage of every legal twist and turn in the U.S. tax code.

      And that's the problem. If Mitt Romney has paid every penny in taxes that he "legally" owes, even at the great expense of our nation and our ordinary citizens, then HE is not the problem, just a symptom of the morally corrupt tax code we have allowed our lawmakers to create.

      And, no -- I don't think anyone is morally obligated to give the government money it has not demanded. Our government should not be beholden to the kindness of strangers, or taxpayers. I voluntarily give money to charities, and I have no problem paying my taxes...and I would willingly pay more.

      But government should not depend on my charity -- because what I have available to give is a lot less than what Mitt Romney has available to give, and he isn't going to give it.  So I am going to just give him his tax break instead of giving to Feeding America?  No.

      If Mitt Romney is NOT paying what is legally owed -- then he is a cheater. And that's a completely different issue.

      But it is up to American citizens to demand a moral tax code. No one is going to just give it to us.

      "I think in America, the opposite of poverty is justice." Bryan Stevenson

      by gfre on Sun Aug 19, 2012 at 06:14:07 PM PDT

      [ Parent ]

      •  Look, he cannot wrap himself in the flag and send (3+ / 0-)
        Recommended by:
        cc, chickeee, joynow

        our unfortunate sons off to war if he isn't even willing to help pay for the wars, for the troops, and for their care when they come home damaged.
        Especially if he was evading taxes by sending money offshore.

        This is outside whether what he did was legal or not.
        He can keep on running Bain without fear of prosecution, but he cannot be Commander in Chief.

        You can't make this stuff up.

        by David54 on Sun Aug 19, 2012 at 10:11:35 PM PDT

        [ Parent ]

    •  Isn't Tax Avoidance His Area of Expertise? (0+ / 0-)

      All of Romney's money has been made through exploiting tricks in Corporate law. Whether he was figuring out how to extract equity from a company teetering on bankruptcy, or avoiding paying taxes, all of his earning come from gaming the system.

      I suspect that he invented many of the tricks on his tax returns himself.

    •  So you say Business Man Romney is too dumb (1+ / 0-)
      Recommended by:
      MrJersey

      to understand investments.

      •  Stanford, Harvard Law, Harvard Business School... (0+ / 0-)

        Those are some decent education chops. He's no idiot.

        I bet he really gets off on ripping people off doing smart business. I believe he is a sociopath.

        Democracy - 1 person 1 vote. Free Markets - More dollars more power.

        by k9disc on Sun Aug 19, 2012 at 11:45:12 PM PDT

        [ Parent ]

  •  O paid for WH upgrades out of his pocket (4+ / 0-)

    Romney is a complete tax dodger.  Jobs and Security comes from people paying taxes.

    O saves the country money. Romney makes the middle class cover his payments.  should be a turkey shoot during debates.  and the millions the Kochs are wasting will be a painful lesson in how much they have to spend on a losing message. more power to them

    paul ryan created the deficit

    by rasfrome on Sun Aug 19, 2012 at 03:30:21 PM PDT

  •  The Question for the People of America (10+ / 0-)

    The Question for the Voters in this election is whether they really want to elect a man who chooses not to pay taxes, who chooses not to serve his country, who chooses to avoid paying every tax possible to serve as the leader of our Nation.  The Problem is that we have one political Party who sees absolutely nothing wrong with those choices, and actually prefers the man who made those choices to the other candidate, for one significant reason.  President Barack Obama is half-black.

    It is really sad, but it is the truth but the Tea Party and the GOP have one objective: ANYBODY BUT OBAMA!

    Racism is Ugly, and it is the face of the GOP

    Dick Cheney said, "Pi$$ on 'em!" And, Ronald Reagan replied, "That's a Great Idea. Let's Call it 'Trickle Down Economics!"

    by NM Ray on Sun Aug 19, 2012 at 03:37:33 PM PDT

    •  The Robber Barrons... (1+ / 0-)
      Recommended by:
      cotterperson

      Have been plotting to raid the treasury AGAIN, Romney is their poster child, and Ryan is the policy wonk with the tools to raid the 'lock box' -
      I like what someone else posted : Koch bros. have this dirt on him so he'll do as he's told, or risk impeachment leaving rAyn to loot and pillage through the fine print....

    •  Not really. There's a lot of race pandering, and a (1+ / 0-)
      Recommended by:
      cc

      lot of suppressed racial animus coming out, but the base of the gop and the core of the party are the anti-abortion, religious right radicals.
      They don't want to give Obama a chance to appoint 2 or maybe 3 more scotus.

      The other factor is Wall Street and their wishes. They don't like the idea of a 2nd Obama term.

      Finally, one other group is the neocon element.

      I'm not saying the race pandering isn't there, but it's mostly a means to an end for these other influences.

      You can't make this stuff up.

      by David54 on Sun Aug 19, 2012 at 10:18:11 PM PDT

      [ Parent ]

      •  IMHO, the average Teabagger's conception of SCOTUS (2+ / 0-)
        Recommended by:
        chickeee, NM Ray

        as an issue is obscured by the vision of a black man in the White House.  I see racism as the glue that holds the Teabaggers together.

        And it feels like I'm livin'in the wasteland of the free ~ Iris DeMent, 1996

        by MrJersey on Sun Aug 19, 2012 at 10:31:17 PM PDT

        [ Parent ]

        •  Well, the diehard loyal-to-the-end Bushies were (1+ / 0-)
          Recommended by:
          NM Ray

          the anti-abortion religious right.
          They quickly jumped on the 'tea party' bandwagon.
          I think the "abortion hysteria" is what gives them (what they believe) is the moral authority to race-bait in their effort to defeat Obama.
          Obviously a lot of them are just swimming around in this swill of "they're taking our guns, Obama's a muslim, Kenyan, socialist, Chicago thug, atheist, abortion, etc.
          All that stuff.
          But I think the religious right is the core of the gop.
          That doesn't mean they're not full of fear and loathing over race, to some degree.

          You can't make this stuff up.

          by David54 on Sun Aug 19, 2012 at 10:49:15 PM PDT

          [ Parent ]

      •  I'm pretty sure Wall St are fine with Obama. nt (0+ / 0-)

        Democracy - 1 person 1 vote. Free Markets - More dollars more power.

        by k9disc on Sun Aug 19, 2012 at 11:46:55 PM PDT

        [ Parent ]

    •  Well, black and a Democrat. A combo reason. (1+ / 0-)
      Recommended by:
      NM Ray

      Many of them would have voted for someone like Colin Powell back when
      and many would still would hate Obama if he weren't half black
      though few with the same fervor or passion.

      Hating Obama is a very strange hobby, such unearned hate.  But hate radio and fox make it pretty easy , almost a  duty to hate the liberal enemy they bash if you listen and believe.

  •  What we fail to understand is that it's a game (0+ / 0-)

    The Republican Administrations beginning with Reagan are following the same strategy first proposed by Jude Wanniski in his two Santa Claus Theory. http://capitalgainsandgames.com/...

    Really don't mind if you sit this one out. My words but a whisper -- your deafness a SHOUT. I may make you feel but I can't make you think..Jethro Tull

    by RMForbes on Sun Aug 19, 2012 at 04:06:54 PM PDT

  •  Here's a key few sentences: (2+ / 0-)
    Recommended by:
    cotterperson, greengemini
    But there is something in the Republican chemistry that causes the GOP to become hypnotized by the prospect of an imbalanced budget. Static analysis tells them taxes can’t be cut or inflation will result. They either argue for a tax hike to dampen inflation when the economy is in a boom or demand spending cuts to balance the budget when the economy is in recession.
    Emphasis added by me...

    In other words, the GOP is poised to do exactly the WRONG thing at this time, as usual...

    For a better America, vote the GOP out of office whenever and wherever possible and as soon (and as often) as possible!

    by dagnome on Sun Aug 19, 2012 at 04:23:04 PM PDT

  •  Romney's is the epitome of an elitist campaign. (1+ / 0-)
    Recommended by:
    cotterperson

    He deigns not to acknowledge the rights of the little people to review and pass judgment on his plans. Leave it to your betters, people. Get on with your lives, or, as GWB said after 9/11, go shopping!

    The GOP can't win on ideas. They can only win by lying, cheating, and stealing. So they do.

    by psnyder on Sun Aug 19, 2012 at 04:24:13 PM PDT

  •  Why? Would this explain it somehow? (0+ / 0-)

    The income for Form 990T would come "from an activity engaged in by a tax-exempt" organization that is not related to its non-profit status (wikileak snip below). The Mormon Church is non-profit, but it also owns lots of for-profit businesses and investments. Bain Capital was involved in some of them.

    Business Week published a long story in July, How the Mormons Make Money, describing some of their businesses and noting that "the LDS Church remains tight-lipped about its holdings."

    This little snip is about only two of them, but the excellent article has much for information.

    First among its for-profit enterprises is DMC, which reaps estimated annual revenue of $1.2 billion from six subsidiaries, according to the business information and analysis firm Hoover’s Company Records (DNB). Those subsidiaries run a newspaper, 11 radio stations, a TV station, a publishing and distribution company, a digital media company, a hospitality business, and an insurance business with assets worth $3.3 billion.

    AgReserves, another for-profit Mormon umbrella company, together with other church-run agricultural affiliates, reportedly owns about 1 million acres in the continental U.S., on which the church has farms, hunting preserves, orchards, and ranches.

    engaged in, but not related
    Unrelated Business Income Tax (UBIT) in the U.S. Internal Revenue Code is the tax on unrelated business income, which comes from an activity engaged in by a tax-exempt 26 USCA 501 organization that is not related to the tax-exempt purpose of that organization.

    https://en.wikipedia.org/...

    "Let each unique song be sung and the spell of differentiation be broken" - Winter Rabbit

    by cotterperson on Sun Aug 19, 2012 at 04:30:57 PM PDT

  •  ?? (0+ / 0-)
    ...we are left to "guess" Romney's IRA paid zero taxes on the Millions of dollars of income his IRA earned as it engaged in Commercial activity.
    I can state with certainty that Romney paid no taxes on the growth of his IRA. Neither did I, and my IRA is right here in the good ol' US of A.

    The whole point of IRAs is that they grow tax-free. Money withdrawn from IRAs during retirement is taxed, at ordinary income tax rates, NOT capital gains tax rates.

    Democracy - Not Plutocracy!

    by vulcangrrl on Sun Aug 19, 2012 at 04:46:12 PM PDT

    •  !! (0+ / 0-)

      You are having a brief moment of cognitive dissonance as the diarist's thesis is challenging your preconceived notions.

      Suspend your certainty.  Reread the diary.  Spend a few minutes to Google the term "IRA UBIT".  The diarist has just taught many of us something counterintuitive, and it is important to know.

      "They let 'em vote, smoke, and drive -- even put 'em in pants! So what do you get? A -- a Democrat for President!" ~ Faster, Pussycat! Kill! Kill!

      by craiger on Sun Aug 19, 2012 at 06:01:50 PM PDT

      [ Parent ]

      •  Still ?? (2+ / 0-)
        Recommended by:
        HiBob, craiger

        The diarist's argument depends on the assumption that the IRA gained a lot of value b/c it was carrying on an unrelated business activity.

        Typically, an IRA will owe UBIT tax in one of three circumstances:
        - When an IRA owns real estate that has financing attached
        - When an IRA owns an LLC that is an operating company   (unrelated trade or business)
        - When an IRA receives rents on personal property
        http://www.nuwireinvestor.com/...

        We have absolutely no reason to believe that Romney's IRA did any of these. Much more likely is that he put low cost shares into an IRA and the shares gained a lot of value. There's an insider trading stench about it - no doubt he knew the shares would gain value - but it's legal and not a UBIT-taxable event.

        The diarist claims:  

           Let's be clear, there is no way in hell, under any legal, accounting scenario that Romney's IRA could have accumulated $100 Million Dollars without Romney's IRA engaging in Commercial activity.
        If I put 10,000 shares of a penny stock in my IRA and the company turned out to have the cure for cancer or whatever and became worth $500/share, my IRA would be a lot fatter but I would not owe taxes until I withdrew the money in retirement.

        Don't get me wrong, I TOTALLY agree that if Romney is only going to let us see one year of his taxes until the day before the election, he should certainly show us a COMPLETE tax return for that year. I also STRONGLY believe that Romney should show the American people at least the 5 years of returns that the Obama campaign requested. I also believe that Romney is a money-hungry plutocratic POS. I just don't agree with this UBIT argument, is all.

        Democracy - Not Plutocracy!

        by vulcangrrl on Sun Aug 19, 2012 at 07:04:13 PM PDT

        [ Parent ]

        •  Respectfully, you are wrong. (0+ / 0-)

              We know Romney's IRA has Bain funds in it.  Bain private equity funds are listed in those assets and those funds are located in the Cayman Islands."

               If Romney's IRA held those funds directly, instead of through a "Blocker Corporation", a 990-T would have been filed. If it [Romney's IRA] has Unrelated Business Income, then it has to pay the Unrelated Business Income Tax and a 990-T would need to have been filed.

              Since there was no Form 990T filed then Romney has paid zero UBIT on his Unrelated Business Income because Romney has  his IRA in a Foreign Tax Haven.

              The worst part: We have a candidate for President who keeps We the People "guessing" about every single issue.

              Romney Tax Policy: no details so we guess what the details are.

               Romney Foreign Policy:  no details so we guess what the details are.

               Romney Immigration Policy:  no details so we guess what the details are.

               Romney Financial Data for 2002 Olympics: Financial Data shredded thus no details so we guess what the details are.

              Romney's emails as governor: shredded thus no details so we guess what the details are.

               Romney's hard-drive as governor: he took the hard-drive with him thus no details so we guess what the details are.

              Romney's Investments in Iran Oil that appeared on his 2006 Financial Disclosure Form: Disappeared with no details so we guess what the details are.

              Sad day in American Presidential politics when the Republican candidate is so shady that We the People have to "guess" what he means.

          •  Specifically ??? (0+ / 0-)

            How do you know "[Romney's IRA] has Unrelated Business Income"? That's the sticking point for me.

            Democracy - Not Plutocracy!

            by vulcangrrl on Sun Aug 19, 2012 at 07:44:59 PM PDT

            [ Parent ]

            •  Because we know Romney's IRA has Bain Funds (1+ / 0-)
              Recommended by:
              jdmorg

              in it --

              We also know, those Bain Funds in Romney's IRA are located in the Cayman Islands and Bermuda.

              We also know, even if Romney valued the assets he put in his IRA at far less than he would have sold them for, his IRA still would not have accumulated $100 Million dollars.

              The biggest problem is:
                  Romney keeps us "guessing" what he did as his meager, incomplete disclosure of his 2010 tax records and financial information does not indicate the various kinds of assets were put in his IRA.

              You're guessing, I'm guessing ... we're all guessing because Romney refuses to answer any questions regarding how he accumulated $100 Million Dollars in his IRA.

              Romney wants to keep us "guessing" because, as his wife Ann said, if they release any more Tax records it will be "ammunition" ... ammunition as in smoking gun?

            •  Another way to look at it: (1+ / 0-)
              Recommended by:
              greengemini

              Romney is running for President of the United States.

              As candidate for President, why wouldn't Romney tell us all how he accumulated $100 Million Dollars in his IRA so we could all end up with $100 Million dollars in our IRA?

              Wouldn't that be a great way to avoid Medicare, Medicaid or Social Security going broke?

              If Mitt came out tomorrow and said, ok, here's how my IRA amassed a staggering $100 Million Dollars and I hope all "you People" do exactly as I did so you too will be able to retire with at least $100 Million dollars to live on ---

              See, Medicare, Medicaid and SS problem solved.

            •  I should add: (0+ / 0-)

              We also know, even if Romney valued the assets he put in his IRA at far less than he would have sold them for, his IRA still would not have accumulated $100 Million dollars.

              Therefore, we know there is no way in hell, under any legal, accounting scenario that Romney's IRA could have accumulated $100 Million Dollars without Romney's IRA engaging in Commercial activity that would give rise to Unrelated Business Income.

            •  This might help clarify things for you: (1+ / 0-)
              Recommended by:
              greengemini

              you wrote:

              Typically, an IRA will owe UBIT tax in one of three circumstances:
              - When an IRA owns real estate that has financing attached
              - When an IRA owns an LLC that is an operating company  (unrelated trade or business)
              - When an IRA receives rents on personal property
              I bolded, "When an IRA owns an LLC that is an operating company   (unrelated trade or business)

              Bain Capital LLC is an asset listed in Romney's IRA.

              I think you actually answered your own question without realizing that Bain is an LLC.

              •  Help me out here... (0+ / 0-)

                If an IRA owns an LLC, and that LLC pays, like a good soldier, all the taxes that are due from it, are you saying that the IRA has to pay taxes on the after-tax value of that LLC, just because it's enveloped within an IRA?

                •  I am saying (0+ / 0-)

                  If an LLC is an asset in an IRA and that LLC trades or does other "unrelated business" then the "unrelated income" the IRA earns is taxable and the IRA must, by law, pay taxes on that Unearned Business Income and file Form 990T showing those UBIT were paid.

                  That's what Unrelated Business Income Tax is ...

                  Notice, keyword: income.

                  •  I'm still not clear on this (0+ / 0-)

                    and I'm not dissing, this schmuck just really wants to know what happens in the scenario:

                    I have an IRA, which owns an LLC, which does what it's business model says it does, and pays its own taxes accordingly.

                    My IRA owns this company as an asset, not as an income-producer. The IRA merely owns the company in the hopes that the company itself will be worth more in the future. Until my IRA sells the company, there are no realized gains. Would a UBIT still have to be filed against unrealized gains?

    •  IRA's Owe Taxes When: (4+ / 0-)
      Recommended by:
      greengemini, episty, cc, Sophie Amrain

      If the IRA owns a business and makes money directly from the things that business sells or from trading property or other types of tangible goods. In that event a UBIT will have to be filed and taxes paid on those category of earnings.

      It is entirely speculative that Romney may have amassed the fortune in his IRA through the above means. It is also possible that he used his IRA to purchase grossly undervalued stock from the privately held Bain and then received huge amounts of money through the disbursement of profits.

      Where it gets complicated is then he was the sole owner of Bain so the way he was receiving money from it was more like owning a store and making money buy selling stuff (in this case entire companies) then just investing in a Publicly owned company where you have no control about how revenues are realized.

      The theory is that in order to avoid being hit with taxes on the Bain earning he hid behind multiple layers off-shore corporations. Perhaps his IRA owns several off-shore corporation that in turn each owned a piece of Bain. Or maybe it wasn't Bain at all that these corporation owned but other smaller private businesses who revenue would have been subject to taxes even within an IRA that were hidden away. Perhaps when he "sold" Bain in 2002 he actually sold a good chunk of it to himself through layers of offshore accounts which may open him up to charges of fraud.

      One things for sure, Romney doesn't want an army of accountants and tax experts going over his IRA's holding with a fine tooth comb.

      http://www.wiki-investor.com/...

      •  That makes better sense. (0+ / 0-)
        If the IRA owns a business and makes money directly from the things that business sells or from trading property or other types of tangible goods. In that event a UBIT will have to be filed and taxes paid on those category of earnings.
        That makes sense. On the other hand, you could argue that if an IRA owns a business, but doesn't make money from day-to-day operations of that business, and instead calculates its value from the overall value of that business, then a UBIT wouldn't have to be filed. For example, I'm thinking of an IRA that buys a business at a low price. That business is really good at its stuff, and is making all kinds of profit, but none of that profit makes its way to the IRA. Instead, the IRA at a later date sells the business at a high price...
      •  the UBIT probably doesn't derive from (1+ / 0-)
        Recommended by:
        ElaineinIN

        the biz activities of the portfolio companies, but rather from the fact that they're "debt financed." under 512 of the code, income from leveraged investments is ubti.  the section was intended to stop SILO tax shelters, so congress periodically considers repealing this particular ubit provision.

        •  Did you say leveraged? (0+ / 0-)

          That's pretty interesting considering Bain made all of its money through leveraged buyouts. I am beginning to wonder not if Romney broke laws but how he has managed to get away with it for so long.

    •  Differences between (0+ / 0-)

      Traditional IRA, ROTH IRA and SEP-IRA

      SEP-IRA

          A SEP (Simplified Employee Pension) IRA is a type of retirement account that an employer or someone who is self-employed can establish.  Contributions are tax-deductible and maximum contribution is roughly $49,000.00 per year, closer to $30,000 when Romney set his up.  
            SEP-IRA must pay Unearned Business Income Tax on income earned inside the IRA and file Form 990T.
      ROTH IRA:
          For a ROTH IRA, contributions are after tax money.  Since the individual used "after tax money" to put in the ROTH, the money taken out of the ROTH is not subject to tax down the road.  Maximum contribution is $5,000.00 per year.  ROTH IRA must pay Unearned Business Income Tax on income earned inside the IRA and file Form 990T.
      Traditional IRA:
          In traditional IRA contributions are tax-deductible however, you must pay taxes on your distributions when you withdraw money (contrary to a Roth IRA).  Maximum contribution is $5,000.00 per year.
          Individuals can contribute to both a Traditional and ROTH within the same calendar year, but the $5,000 max is combined. In other words, you cannot be sneaky and contribute $5,000 in each for a total of $10,000.

           IRAs can have unrelated business income and therefore pay tax.

           For example, the Roth buys real estate with non-recourse debt, any income allocatable to non-recourse debt is subject to Unrelated Business Income Tax (UBIT).

          I hope that clarifies things for you.

  •  You little people and your concerns (0+ / 0-)

    You're just so cute!

    I don't know if I could take it if I awaken to a Romney presidency. I'm sure the country can't.

    That the ELECTED might never form to themselves an interest separate from the ELECTORS, prudence will point out the propriety of having elections often -Thomas Paine

    by Anthony Page aka SecondComing on Sun Aug 19, 2012 at 05:14:08 PM PDT

  •  I think your diary hits upon a very important (2+ / 0-)
    Recommended by:
    MrJersey, cc

    point that will resonate with millions of Americans if the media really lays it out for them:

     In short, We the People know that people who use Foreign Tax Shelters to avoid paying U.S. Taxes are directly harming our Troops and forcing America to go further in Debt to China.

    You can't make this stuff up.

    by David54 on Sun Aug 19, 2012 at 09:59:49 PM PDT

  •  There are so many questions... (1+ / 0-)
    Recommended by:
    cc

    ... about what could be in Romney's tax returns that I have trouble remembering which one we are focusing on in this post, and why.  I think Romney could withstand revealing anything except that he participated in the Swiss Account amnesty program (e.g. that he participated in a felonious activity.)  Why won't some brave member of the "lame stream media." just ask him whether or not he took advantage of the amnesty program.  If he said "No, I did not!," I would take him at his word.  He cannot afford being caught in blatant, un-nuanced lie, and there have to be enough people both in the US and Switzerland who know the facts in this matter that the truth will come out at some point.  (This is not Top Secret Codeword stuff.) If on the other hand he equivocated... like saying, "I will not discuss my taxes!"  then in my mind he is guilty.  The circumstantial evidence is all there.

  •  Biff Romney - Tax Cutting Tax Cheat. nt (0+ / 0-)

    Democracy - 1 person 1 vote. Free Markets - More dollars more power.

    by k9disc on Sun Aug 19, 2012 at 11:54:35 PM PDT

  •  a correction: (0+ / 0-)
    Like an individual's K-1, w-2 etc., the Trustee of the IRA sends Form 990T to the individual IRA holder, in this case Romney, and the individual attaches Form 990T to the Individual's Form 1040 and all accompanying Schedules.
    I have no idea where you got that, but it isn't even remotely true.  yes, the IRA custodian would submit a 990T but it isn't attached to the 1040.
  •  Entitled to America (0+ / 0-)

    So many of these people take "the American way of life" as a birthright but don't want to pay anything for it.  And since we're not paying for it, it's going away.  Everything that bustled and beckoned about America for so long was a product of our once-unique proprietary blend of business-government-education-infrastructure-populus collaboration.

    ------
    Ideology is when you know the answers before you know the questions.
    It is what grows into empty spaces where intelligence has died.

    by Alden on Mon Aug 20, 2012 at 06:47:10 AM PDT

  •  Pay zero taxes. (0+ / 0-)

    But somebody has to own the debt that accumulates due to the tax cuts right? So in his fantasy world Mitt buys the debt and we pay him. Neat. Sort of reverse taxation. He is the owner, not the taxpayer.

    So we become his sharecroppers.

    it's the nut in the nutshell

    by themank on Mon Aug 20, 2012 at 07:29:37 AM PDT

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