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Dem Lawmakers Want Answers About Romney’s Enormous IRA

ProudProgressive 2012/08/03 17:04:16

A lot of people have an IRA account to plan for their retirement. Mere mortals have a contribution limit of $6,000 annually. Yet Mitt Romney, who seems to have a new financial scandal every day lately (at least when he's not off insulting our allies), has an IRA account with over $100 million dollars in it.

For the record, it would take us mere mortals 1,666 years at $6,000 a year to amass $100,000,000. Just saying.

Article excerpt follows:

Dem Lawmakers Want Answers About Romney’s Enormous IRA
Brian Beutler
August 3, 2012

Leading House Democrats want to turn Mitt Romney’s enormous IRA into more than just a political problem.

Romney’s most recent financial disclosure form revealed that his tax-deferred individual retirement account holds upwards of $100 million — an amount that awkwardly showcases his enormous wealth but also raises legal and ethical questions.

IRAs are intended to allow workers to put away modest sums of money each year in order to help finance a middle class retirement. The savings are tax deferred, but there’s a legal limit — now $6,000 — on how much each IRA holder can contribute annually.

Now top Democrats on the Budget, Ways and Means, and Education and Workforce Committees want to know how people of Romney’s wealth can end up with 100,000 times that much money in a single IRA, and how much the tax and investment strategies they employ cost the Treasury in revenue every year.

In a letter Thursday to senior officials at the Treasury and Labor departments, Reps. George Miller (D-CA), Sander Levin (D-MI), and Chris Van Hollen (D-MD) want to know: Is this legal? How easy is this strategy to get away with? How much does it cost the government every year? And what can be done to end the practice?

“[W]e are alarmed to learn that wealthy taxpayers may be taking advantage of a tax subsidy that is designed to provide for retirement to instead accumulate massive amounts of tax-sheltered assets,” the lawmakers write. “Given your commitment to the rule of law and equitable treatment of taxpayers, we hope that you will evaluate this issue carefully to ensure that a select few are not being provided with a loophole that allows for wrongful tax evasion.”

The lawmakers’ inquiry has a substantive, policy basis — but the politically charged question is also a shot across Romney’s bow.

“[R]ecent news reports indicate that Bain Capital allowed service partners and employees to co-invest in investment deals via tax-preferred retirement accounts … in some cases providing one-fourth of the total capital in the investment deals,” the lawmakers write.

They go on to speculate about how it worked.

“Some experts have expressed the view that the investments made through these accounts and plans may have been assigned a nominal value that was significantly lower than the fair market value of the investments, perhaps using a liquidation value methodology. In particular, this strategy has been cited as one explanation for how presidential candidate Mitt Romney’s IRA is valued at between $20 and $101 million despite the annual contribution limits that apply to tax-preferred retirement accounts and plans.”

To translate, Romney could have skirted the annual contribution limit if his IRA invested heavily in Bain projects by dramatically lowballing the value of the stakes.

If the administration is forthcoming — and why wouldn’t it be? — its answers to these questions will be general, not about Romney specifically. But those answers will broadly apply to Romney and his IRA, and could bring some clarity to one technique people of Romney’s wealth can use to amass even more.

Read More: http://tpmdc.talkingpointsmemo.com/2012/08/mitt-ro...

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  • A Founding Father 2012/08/03 18:39:49
    A Founding Father
    +1
    Once assets are placed in an IRA, the "earnings" thereon are not taxable until withdrawn.
    So, being the "sole shareholder", CEO, and "Chief Officer" of Bain Capital, Mitten could
    "purchase" from the IRA the assets for $100Million of Bain Capital money, making himself a tax free income of $100Million.

    Such things go on every day among those who have the resources and attitude to do so. I really don't want such a person in control of any portion of my Government as there is just no way to know what portion of the Federal structure he might decide to "arrange" for himself or his family to own. What if he decided to sell some of the US nuclear arsenal or to "outsource" operations of our Pentagon to a Chinese or Indian investor?
  • Sgt Major B 2012/08/03 18:37:53
    Sgt Major B
    More allegations of 'maybe', 'could be', 'somebody told me' with no basis in fact. Looks like the Dems have mastered the techniques of what they labeled as 'McCarthyism' 60 years ago.
  • gfreeman BN-0 2012/08/03 17:38:57
    gfreeman BN-0
    +1
    Well, this just proves he's a robot, because he plans on deferring his IRA for the next 1600 years.

    In all seriousness, how is it even possible to amass that much money in an IRA? Wouldn't the bank/investment firm just stop taking contributions once the 6000 dollar/year limit is reached?
  • SickOfBigGov 2012/08/03 17:14:13
    SickOfBigGov
    +2
    LOL...a new financial scandal? You guys haven't proved the last one yet! LOL..You guys can't find a sexual misconduct, so now you have to make up lies about his finances. I'm sure Valerie Jarrett is getting very impatient with y'all.
  • ProudPr... SickOfB... 2012/08/03 17:21:53
    ProudProgressive
    +1
    If they're lies, let Mitt provide the truth. Why won't he release his tax returns? What is he hiding? Why did he tell the American public that he left Bain Capital in 1999 when his sworn SEC filings show he was still running the company three years later? How did one of his business partners wind up getting one of the biggest sweetheart deals of the 2002 Olympics, which Romney was supposed to "clean up"?

    And what does Valerie Jarrett have to do with anything?
  • SickOfB... ProudPr... 2012/08/03 17:33:37
    SickOfBigGov
    +1
    Better question yet, why don't you demand your party clean up their own house. BTW, these are DOCUMENTED tax cheats:
    "Facts----Timothy Geithner, Obama's pick for Treasury Secretary. Geithner failed to pay
    34,000 in taxes on his income from the International monetary Fund. He tried to
    pass it off as an innocent mistake because of the way the IMF pays. That would
    have been a good excuse, had he not testified in front of congress in 1998,
    explaining the complicated circumstances
    Rep Hilda Solis. Obama's pick for Labor Secretary, owed state on local taxes
    on their auto business. Additional tax cheats picked by Obama include Kathleen
    Sebelius, Nancy Killefer, Capricia Marshall, and others. And it's not just
    cabinet officers who owe back taxes. In the White House staff, there are 41 who
    owe a total of over 831,0000 dollars Now add to the list other democrat
    politicians who are tax cheats, like Charles Rangel and Al Franken, who had to
    be taken to court in New York State in order to get him to pay up. Sherrod
    Brown, the big tax lover failed to pay his property taxes 3 years in a row and
    the property he owned was actually listedup for the Sheriff's Auction.
    Then there's Media Matters who has a 501(C)(3)
    tax exempt status. As such they are not allowed to provide the DNC or WH with
    coord...













    Better question yet, why don't you demand your party clean up their own house. BTW, these are DOCUMENTED tax cheats:
    "Facts----Timothy Geithner, Obama's pick for Treasury Secretary. Geithner failed to pay
    34,000 in taxes on his income from the International monetary Fund. He tried to
    pass it off as an innocent mistake because of the way the IMF pays. That would
    have been a good excuse, had he not testified in front of congress in 1998,
    explaining the complicated circumstances
    Rep Hilda Solis. Obama's pick for Labor Secretary, owed state on local taxes
    on their auto business. Additional tax cheats picked by Obama include Kathleen
    Sebelius, Nancy Killefer, Capricia Marshall, and others. And it's not just
    cabinet officers who owe back taxes. In the White House staff, there are 41 who
    owe a total of over 831,0000 dollars Now add to the list other democrat
    politicians who are tax cheats, like Charles Rangel and Al Franken, who had to
    be taken to court in New York State in order to get him to pay up. Sherrod
    Brown, the big tax lover failed to pay his property taxes 3 years in a row and
    the property he owned was actually listedup for the Sheriff's Auction.
    Then there's Media Matters who has a 501(C)(3)
    tax exempt status. As such they are not allowed to provide the DNC or WH with
    coordination, but they do. They won't lose their tax exempt status until 2013,
    when our corrupt president and the head of the DOJ are nothing but a very bad
    memory
    Obama likes to talk about people paying their fair share, but shouldn't we
    make the democrats pay their current taxes before we raise anyone else's?
    Also the champion of high inheritance taxes, Teddy Kennedy, didnt have to
    worry about the taxes himself as the family trust is in Fiji, where Poppa Joe
    put it when FDR informed him the tax structure would change. The tax started in
    1916 and only applied to assets that were liquidated. FDR changed that to all
    assets with a few deductions
    Warren Buffet, Obama's favorite billionaire
    and the man who cries that he pays a lower percentage than his secretary.
    Perhaps he would be paying more than her if he paid the 1.05 billion
    billion is not an error he owes through his Berkshire Hathaway
    investment fund"~posted by a very smart SH
    (more)
  • JCD aka "biz" 2012/08/03 17:11:21
    JCD aka "biz"
    +1
    Mitt "No Tax Returns" Romney has probably saved a penny a day for the past 25 million years (4 dollars a year).

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