# Romney pays 15% taxes

by JonDE
Tags: pays, romney, taxes
PF Patron
P: 7,122
 Quote by Ryan_m_b An important part of the argument against this sort of thing is that it ends up with the richest in society paying proportionally less tax than those at the bottom on all of their money coming in which many would say is not a fair system.
The people at the bottom, as shown many times on this forum, pay next to nothing in federal taxes.

I find capital gains taxing a little stupid to be honest. It's money already taxed, it goes back out into the world to hopefully create some jobs by investment, comes back, gets re-taxed, goes back out, gets re-taxed, over and over and over. Hell, assuming these are long-term capital gains taxes, all these investments were something we should be praising in our society - long term investments, not day trading nonsense.
Mentor
P: 24,974
 Quote by Pengwuino I find capital gains taxing a little stupid to be honest. It's money already taxed, it goes back out into the world to hopefully create some jobs by investment, comes back, gets re-taxed, goes back out, gets re-taxed, over and over and over. Hell, assuming these are long-term capital gains taxes, all these investments were something we should be praising in our society - long term investments, not day trading nonsense.
well, except that the bulk of his investments are in tax free Cayman Islands.

 WHAT ABOUT GIFT TAXES? Romney has a $100 million trust set up for his five sons. The campaign said the Romneys paid no gift taxes on the trust because they were able to use credits related to estate tax. OFFSHORE INCOME Romney's investment funds run through Bain are in offshore tax havens such as the Cayman Islands, a practice the campaign insists is legal and common but that has come under some criticism during the campaign. Some of these investments also are held through two Individual Retirement Accounts and investing IRAs offshore can eliminate all taxes until withdrawals are made. http://nbcpolitics.msnbc.msn.com/_ne...eveal-and-omit This isn't about risk taking or investing in US companies and stimulating the economy as some people in this thread have suggested, it's about tax shelters. I want to remind members that making false claims is a violation of the rules. In other words, before you make a claim, reasearch it and post a valid source.  WHAT ABOUT ROMNEY'S PRIVATE EQUITY PROFITS? Much of Romney's fortune likely qualifies as what is known as "carried interest," a share of profits earned by private equity managers taxed at the 15 percent capital gains tax rate rather than the maximum 35 percent wage rate. Private equity managers, some hedge fund executives and venture capitalists benefit from carried interest. Campaign officials said Romney had carried interest of$7.4 million in 2010 and $5.5 million in 2011. Critics say the 15 percent rate for carried interest is an unfair tax break because investment managers, as Romney was, are providing a service that should be taxed at the higher rate paid by wage earners. PF Patron P: 7,122  Quote by Evo well, except that the bulk of his investments are in tax free Cayman Islands That's always been a fishy area, but I still find capital gains taxation to be stupid. Mentor P: 24,974  Quote by Pengwuino That's always been a fishy area, but I still find capital gains taxation to be stupid. Yeah, but this is about Romney, not the average American. And to members, let's not go off topic into a discussion of taxes unless it is about Romney. And everyone needs to read the P&WA rules, which aren't being followed here by some members (not you Peng).  PF Patron P: 7,345 Romney should pay income taxes like the rest of use, regardless of how the income is derived. I'm all for a reduced-rate on capital gains, but only if the investment is held for a significant length of time, on a par with the length of time that normal Americans have to hold Savings Bonds. P: 126  Quote by Evo Yeah, but this is about Romney, not the average American. And to members, let's not go off topic into a discussion of taxes unless it is about Romney. And everyone needs to read the P&WA rules, which aren't being followed here by some members (not you Peng). Sounds like your actual pique is that Romney's rich, you're not, and you want the Government to rectify the situation. PF Patron P: 1,930  Quote by obafgkmrns Sounds like your actual pique is that Romney's rich, you're not, and you want the Government to rectify the situation. Uh-huh. You're gonna need a lot more evidence than that for your so-called "argument" to fly. Mentor P: 24,974  Quote by obafgkmrns Sounds like your actual pique is that Romney's rich, you're not, and you want the Government to rectify the situation. I haven't said anything like that. Not even a good attempt at a strawman fallacy based on what you quoted. Mentor P: 21,652  Quote by turbo Evo has a point. If Romney reduced his tax-burden by making tax-deductible contributions to the Mormons, he has foisted off the deduction on all the rest of us taxpayers. If we truly have a "separation of church and state", then why do donors' income taxes (a governmental function) get reduced by making donations to churches? Why should my tax-burden go up so some fat-cat can reduce his taxes by making a donation to a church? Doesn't seem right. I don't think you really want to go down either of those roads, turbo: First, if you're worried about people reducing their taxes via deductions increasing the burden on the rest, then you bring into play the 47% who bring their burden down to zero via deductions. Second, this has nothing to do with separation of church and state. Romney's individual charity choice is his, not the government's.  Mentor P: 21,652 I am in favor of closing this loophole for the rich (working age people who derive their income from capital gains), but don't trust liberals at all on the issue. Getting a clear definition of "rich" is like nailing jello to a wall: the 99% is the new buzzword, but I've never seen a tax proposal that didn't reach much further down in defining the "rich". P: 18  Quote by Evo And while most people pay social security and medicare taxes on 100% of their income, none of his capital gains income are taxed and won't be until the new tax law goes into effect in 2013. Most people pay SS and Medicare taxes on 100% of their income because those are systems that are supposed to be what you pay in, you get paid out. If they did this for very high incomes, then you'd get people who don't need SS or Medicare getting very large SS and Medicare payments, which wouldn't be too popular. If one makes the high-earners pay into SS and Medicare while putting a cap on how much in benefits they receive, then SS and Medicare become a de-facto welfare program, which opens up a whole other can of worms.  Quote by Evo Giving to a church that will grow rich off of most of it as opposed to giving to a charity that will use most of it for work that benefits society, yeah, I guess I don't consider giving money to super wealthy churches the same as giving to charity. Isn't this over-generalizing though Evo? There are churches out there that use their donations to help the community and there are also some very rich, very money-grubbing charities out there. A lot of the money many charities raise gets poured into raising more money, not into helping anybody. The big charities have investment funds, engage in extensive marketing/campaigning/fundraising, and hire top-of-the-line CEOs to run them. For many charities, the goal is not to help anyone anymore but rather to self-perpetuate the charity. HW Helper P: 6,770  Quote by Evo And while most people pay social security and medicare taxes on 100% of their income, none of his capital gains income are taxed and won't be until the new tax law goes into effect in 2013. Also there's a cap on social security, once you make a bit over$106,000 (USA), you stop paying any FICA (social security) taxes, a regressive tax bracket that goes from 6.25% (now 4.25% with tax cut) to 0%. Eliminating the FICA cap would greatly help the social security system from going bankrupt.

 capital gains
Other than IPOs, most of the money invested in the stock market just moves back and forth between investors. Occasionally companies will buy back their own stock to prop up stock prices; who gains when this is done? The only jobs created by most of this activity are related to the financial industry, like the brokers that make commisions off of stock trading.
Mentor
P: 24,974
 Quote by CAC1001 Isn't this over-generalizing though Evo? There are churches out there that use their donations to help the community and there are also some very rich, very money-grubbing charities out there. A lot of the money many charities raise gets poured into raising more money, not into helping anybody. The big charities have investment funds, engage in extensive marketing/campaigning/fundraising, and hire top-of-the-line CEOs to run them. For many charities, the goal is not to help anyone anymore but rather to self-perpetuate the charity.
That's why I was specific "churches that keep most of the money" meaning most of the money they collect does not go to charitable work, and "charities that give most back to benefit society", as opposed to the ones that keep most of it. For example, a church "charity" could fall into the category of giving most back to society. I apologize if I didn't make that clear. I knew what I was thinking.
P: 18
 Quote by Evo That's why I was specific "churches that keep most of the money" meaning most of the money they collect does not go to charitable work, and "charities that give most back to benefit society", as opposed to the ones that keep most of it. For example, a church "charity" could fall into the category of giving most back to society. I apologize if I didn't make that clear. I knew what I was thinking.
Ahh, okay
Mentor
P: 21,652
 Quote by rcgldr Also there's a cap on social security, once you make a bit over $106,000 (USA), you stop paying any FICA (social security) taxes, a regressive tax bracket that goes from 6.25% (now 4.25% with tax cut) to 0%. Eliminating the FICA cap would greatly help the social security system from going bankrupt. So are you in favor of completely separating the pay-in from the pay-out? I wouln't imagine SS fans would be in favor of that, since eliminating the connection means people may not get back what they pay in.... ...or do you just want to do that for the rich? HW Helper P: 6,770  Quote by rcgldr Also there's a cap on social security, once you make a bit over$106,000 (USA), you stop paying any FICA (social security) taxes, a regressive tax bracket that goes from 6.25% (now 4.25% with tax cut) to 0%. Eliminating the FICA cap would greatly help the social security system from going bankrupt.
 Quote by russ_watters So are you in favor of completely separating the pay-in from the pay-out? I wouln't imagine SS fans would be in favor of that, since eliminating the connection means people may not get back what they pay in.
The study on this included two options. This is a quote from yahoo article (the orignal link is broke, but I saved the quote):

Modify the Social Security tax cap. Workers pay into the Social Security system on earnings up to $106,800 in 2010. About 83 percent of worker earnings were subject to Social Security payroll taxes in 2008. If all earned income above$106,800 annually were subject to Social Security contributions but did not count toward benefits, Social Security's projected deficit would be completely eliminated. If the higher income counted toward Social Security benefits, about 95 percent of the shortfall would be absolved. Other ideas: apply a new Social Security formula to earnings above the current cap or raise the amount of the income cap to apply to 90 percent of all worker earnings.
PF Patron
Emeritus
P: 12,232
 Quote by russ_watters I am in favor of closing this loophole for the rich (working age people who derive their income from capital gains), but don't trust liberals at all on the issue. Getting a clear definition of "rich" is like nailing jello to a wall: the 99% is the new buzzword, but I've never seen a tax proposal that didn't reach much further down in defining the "rich".
Why specify rich? If someone isn't yet retirement age and derives income from capital gains, why should it matter how much of the rest of their income comes from other sources? I really do think it makes sense to tax all income the same, regardless of the source, but then let you apply previous losses as reductions in adjusted gross income without a cap on those either. Money changing hands is all the same to me.

As for Romney, I have no problem with him paying 15% in taxes. It's consistent with current tax law, and he's actually paying his taxes, so what more is there to expect? His 15% is still a heapload more money than probably most here even earn as gross income.
Mentor
P: 21,652
 Quote by rcgldr The study on this included two options. This is a quote from yahoo article (the orignal link is broke, but I saved the quote): Modify the Social Security tax cap. Workers pay into the Social Security system on earnings up to $106,800 in 2010. About 83 percent of worker earnings were subject to Social Security payroll taxes in 2008. If all earned income above$106,800 annually were subject to Social Security contributions but did not count toward benefits, Social Security's projected deficit would be completely eliminated. If the higher income counted toward Social Security benefits, about 95 percent of the shortfall would be absolved. Other ideas: apply a new Social Security formula to earnings above the current cap or raise the amount of the income cap to apply to 90 percent of all worker earnings.
For clarity, that's eliminating the cap on pay-in without changing the cap on pay-out, right? Yeah, I get that: I asked if that's what you want and I asked how you see how that affects the logic upon which the program was created.

You didn't answer my question at all.

 Related Discussions Current Events 735 Current Events 21 General Discussion 18 Academic Guidance 11