Thursday, February 2, 2012
Wall Street Journal, What Was Mitt’s Income in 2009?, by Laura Saunders:
Tax professionals are still mulling [Mitt Romney's 2010 tax return]. Adam Gorlovsky-Schepp, a CPA with Raphael & Raphael in Boston who prepares returns for high-net-worth clients, believes the Romneys’ 2009 income can be estimated from information on the 2010 return.
Based on their state tax refund and their estimated tax payments for 2010—which were low but didn’t trigger penalties—the Romneys’ 2009 adjusted gross income appears to have been about $6.47 million, with federal income tax of about $1.24 million, says Gorlovsky-Schepp. In 2010 they paid nearly $3 million of tax on $21.6 million of income.
That would make their effective tax rate 19% in 2009, much higher the nearly 14% rate they paid in 2010.
Why the big difference between the two years? Gorlovsky-Schepp speculates that the Romneys had large capital losses, perhaps from the 2008 meltdown, that wiped out their 2009 capital gains. That left mainly income from interest, dividends and fees they earned.