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The OutFront Brief: finding facts beyond the headlines in the Romney tax returns
January 24th, 2012
03:26 PM ET

The OutFront Brief: finding facts beyond the headlines in the Romney tax returns

You already know Republican presidential candidate Mitt Romney released his tax returns today. The political headlines read like this: Romney made 42.7 million dollars in two years. He paid a lot in taxes, paid the minimum rate required by law, and gave a lot to charity. But beyond that, what's in the hundreds of pages of paperwork Romney's accountants cranked out?

The OutFront Tax Strike Team–a group of high profile experts in tax law and accounting–sifted through the returns and found a few areas of interest. Among them, Romney's use of blind trusts. Are these trusts truly "blind"? Fortune senior editor Dan Primack notes Romney called blind trusts "a ruse" when he ran against Ted Kennedy for Senate in 1994:

And, at least in his own case, he's largely correct.

According to Romney's financial disclosures and tax returns, a majority of his investment income is derived from private equity

Here's what I mean: According to Romney's financial disclosure and tax forms, a majority of his investment income is derived from private equity funds (and related affiliate funds). And, within his private equity portfolio, most of the funds are managed by Romney's old colleagues at Bain Capital.

The Strike Team also focused on carried interest–a topic OutFront explored last week, when Erin Burnett explained how carried interest works–and why the use of the lower tax rate on this interest costs Americans billions of dollars.

Romney insisted in a Florida debate Monday night that there were no surprises in the returns, and repeated that he's not about to apologize for "being successful." That's not to say the Romney campaign isn't sensitive to the impact the candidate's wealth may have on the race. As CNN notes, searches today on Twitter for "Romney Taxes" "Romney Tax Returns" or "Romney" bring up a promoted tweet that attacks rival Newt Gingrich.

On OutFront tonight, Erin breaks down the returns, shares the results of the Strike Team's review, and evaluates the political fallout–7 p.m. ET on CNN.


Filed under: Economy • Politics
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