Joe Paterno's estate tax mistake
Comparing presidential -- and presidential wannabe -- 1040s

Romney releases 2010, 2011 tax returns

Now we know. The economic downturn also affected millionaire Mitt Romney.

Romney 2010 tax returnTax data released by the Republican presidential candidate show that he had income of $21.7 million in 2010 and $20.9 million last year.

For the 2010 tax year, Romney made public the joint personal tax return he and his wife Ann filed, as well as returns for the Mitt Romney Trust, the Ann Romney Trust, their family trust and the Tyler Charitable Foundation filing.

He also released a 2011 estimated return.

Details, details: What exactly have we learned from all these electronic pieces of paper?

Mitt and Ann Romney are very, very rich even after bringing in a bit less in 2011 than 2010.

For 2010, the couple reported $21.7 million in income, most of it from investments, and paid $3 million in federal taxes. That's an effective tax rate of 13.8 percent.

They expect in 2011 to have around $21 million in income and to pay $3.2 million. That pushes their 2011 effective tax rate up to 15.2 percent.

Since the Romneys' money is primarily from investment earnings, those tax rates are in line with the top long-term capital gains tax rate of 15 percent.

The couple got no money -- nada, zilch, zip -- from ordinary income sources such as the wages most of us report and pay tax rates of up to 35 percent on that income.

They also helped shave a few tax dollars off their IRS bills by giving to charity, primarily to the Mormon church of which they are members.

Of the $7 million in itemized charitable gifts made by the Romneys over 2010 and 2011, just over $4 million of it went to the Church of Jesus Christ of Latter-day Saints.

Also of note (although it's already been widely reported), Romney has money in offshore accounts. You can find Romney cash in such expected tax havens as Switzerland, the Cayman Islands and Bermuda.

But not to worry. CNNMoney reports that:

Brad Malt, a Washington lawyer who serves as trustee of the Romneys' blind trusts, said Romney pays all U.S. taxes on income from the trusts' foreign investments. Further, he said Romney has no role in choosing how the blind trusts invest his money.

"The blind trust investments in the Cayman funds are taxed exactly as if Gov. Romney owned his share of the funds in the United States," Malt said.

And like many less-wealthy Americans, the Romneys are subject to the alternative minimum tax.

This parallel tax system, usually referred to as the AMT, was created to ensure that people couldn't legally avoid all taxes. However, conveniently for the Romneys and other similarly situated taxpayers, the AMT doesn't eliminate the tax benefits of investment income.

Finally, the big reveal in case you didn't already know: Mitt's first name is Willard.

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Something is definitely wrong wit the US tax system!! How is it that ppl tht actually "work" for a living r taxed higher than ppl tht "sit back relax & collect investment income"! Mitt Romney made 21+M & pd 3+M for an effective tax rate of 15% while Newt & Obama pd 31% & 26%. The difference is Romney earnings came from investments & offshore funds while the others actually worked like ran the country, books sales, consulting, & speaking engagements. & Mitt wants 2 tell us taxes r too high!? This just shows how out of wack the bush era preferable tax treatment on interest/dividends & capital gains are!

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