Thursday, August 30, 2012

Romney likely committed tax fraud

In 2009, in an effort to maximize tax revenue, the federal government offered amnesty to people who illegally hid money from taxation in offshore accounts if they agreed to pay back what they owed plus interest and penalties.  15,000 Americans came forward to accept the offer, ponying up cash to avoid felony prosecution.

Mitt Romney is somewhere around the 3,140th richest American.  He made his money in financially complex and opaque ways.  He has admitted to having bank accounts in the Cayman Islands, Bermuda and Switzerland.  His massive IRA worth tens of millions despite relatively-tiny contribution limits indicates his ability and willingness to manipulate the tax code.  He has fought tooth and nail to avoid releasing any taxes from before 2010.

In light of these facts, one must ask oneself "is Mitt Romney one of the 15,000 most likely people to have participated in the amnesty program?"   Isn't the answer undoubtedly "Yes!"?


NWest said...

About 120,000 households have incomes over $1.6 mil / year. One could make the reasonable assumption that most of these people want to pay as little taxes as possible.

Even if we assume all of the 15,000 who accepted foreign tax amnesty are from this top 0.1% of households, this works out to 8% of these folks. I'm not sure it follows that 8% makes it "likely" that Romney is one of these. He's certainly a member of that class of people, but if I were a gambling man, I don't think I'd take that bet.

PS -
As for the IRAs - bankster and wall street lobbyists wrote those bills for both democrats & republicans, so *of course* they would take advantage of them as much as they could.

alex n said...

It's inappropriate to select from the pool of rich people. Rather, select from the pool of rich people who are known to have bank accounts in "tax havens" including Switzerland. Once you're limiting it to this smaller pool the odds increase, especially since the reason for the amnesty was that UBS gave the IRS a list in 2008 of Americans keeping money in Switzerland.

My knowledge of IRAs only go back a few years, but they are pretty cut and dry with the contribution requirements. You can only contribute cash, subject to the appropriate annual limit (approximately 5,000, depending on the year). 26 USC section 408(a)(1) There's not much gray area in that definition.

NWest said...

It's not a standard IRA - Bain had SEP IRAs where the employer could contribute up to 50k, which is a boon to the wealthy and well connected.