tag:blogger.com,1999:blog-9208928.post8707939719081787299..comments2024-03-29T03:16:05.261-04:00Comments on Start Making Sense: 2010 Romney tax return storyDaniel Shavirohttp://www.blogger.com/profile/14710628584922961682noreply@blogger.comBlogger12125tag:blogger.com,1999:blog-9208928.post-37990096385118605632013-02-11T02:20:00.519-05:002013-02-11T02:20:00.519-05:00he listed no cost for it on his tax return. By tra...he listed no cost for it on his tax return. By transferring that stock to his nonprofit Tyler Charitable Foundation, he avoided roughly in capital gains taxes he would have owed. He also shaved an additional off his tax bill by deducting the charitable contribution from his income. <a href="http://www.newswire.net/newsroom/local/new-york/70326-matawan-tax-preparation-service.html" rel="nofollow">matawan income tax services</a><br />Anonymoushttps://www.blogger.com/profile/09988824537426226265noreply@blogger.comtag:blogger.com,1999:blog-9208928.post-50838818028413997162012-07-23T14:02:28.474-04:002012-07-23T14:02:28.474-04:00Hjs, that's an interesting point and would cer...Hjs, that's an interesting point and would certainly help to explain the zero basis. This would also presumably imply sizable capital gains on earlier tax returns from the excess distributions. (There's little reason to think they would have stopped when basis hit zero.)Daniel Shavirohttps://www.blogger.com/profile/14710628584922961682noreply@blogger.comtag:blogger.com,1999:blog-9208928.post-18714071316775980972012-07-23T09:02:21.745-04:002012-07-23T09:02:21.745-04:00basis will be zero since the corp will have paid a...basis will be zero since the corp will have paid a dividend well in excess of e&p and funded by borrowing, prior to going public.hjshttps://www.blogger.com/profile/01602760610767893011noreply@blogger.comtag:blogger.com,1999:blog-9208928.post-56124618649748154892012-07-20T14:54:06.574-04:002012-07-20T14:54:06.574-04:00I think I've misread the foundation's retu...I think I've misread the foundation's returns. Sorry for making a mess of this thread.jpehttps://www.blogger.com/profile/12721892896157356899noreply@blogger.comtag:blogger.com,1999:blog-9208928.post-79091303111629041642012-07-20T13:58:32.361-04:002012-07-20T13:58:32.361-04:00@jpe So, properly, Tyler should've paid cap ga...@jpe So, properly, Tyler should've paid cap gains tax of 2% on the 1.4MM?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-9208928.post-22288245532886712822012-07-20T13:44:18.860-04:002012-07-20T13:44:18.860-04:00("immaterial to his basis" s/b "imm...("immaterial to his basis" s/b "immaterial to the value of his deduction")jpehttps://www.blogger.com/profile/12721892896157356899noreply@blogger.comtag:blogger.com,1999:blog-9208928.post-91902994546636967062012-07-20T13:43:39.473-04:002012-07-20T13:43:39.473-04:00I'm always very skeptical of media takes on ta...I'm always very skeptical of media takes on tax, just because it can be pretty technical and confusing (even for practitioners!).<br /><br />That said, it doesn't look like they're wrong here. Per the Tyler Fdn & Romney returns, he contributed ~1.4MM of stock. He noted basis as zero on his return, probably because it's immaterial to his basis and it can be tricky to figure out when, as is the case here, it was distributed from a partnership. <br /><br />Note that the end result is that the Foundation is understating its net investment income by that same $1.4MM and, because it's in the 2% excise tax bracket, it understated its tax bill by ~28,000. If the basis were zero, it should have reported zero as the contribution and then $1.4MM as capital gain. Instead, it reported $1.4MM as contribution income (which isn't subject to the 2% tax) and zero as capital gain (which is subject to the tax). The only alternative is that it reported the $1.4MM in both categories, but that would've been double counting the income and would've required some sort of adjustment.<br /><br />weird.jpehttps://www.blogger.com/profile/12721892896157356899noreply@blogger.comtag:blogger.com,1999:blog-9208928.post-24251461297939172422012-07-20T13:33:31.790-04:002012-07-20T13:33:31.790-04:00One can undermine any possible article in any publ...One can undermine any possible article in any publication if one simply claims without evidence that the reporter got basic facts wrong. Until someone comes up with contrary evidence, the simplest assumption is that HuffPo got the facts right.<br /><br />Listing a zero basis for a stock you aren't going to be taxed on anyway could be simple sloppiness: after all, the basis is irrelevant for a contribution, so why bother looking it up?<br /><br />On the other hand, this could be evidence of substantive evasion, in which case the smoking gun would be contained in one of the tax returns we have not seen.Robert Westhttps://www.blogger.com/profile/16830743573246446990noreply@blogger.comtag:blogger.com,1999:blog-9208928.post-59236862962723599882012-07-20T13:31:46.391-04:002012-07-20T13:31:46.391-04:00One can undermine any possible article in any publ...One can undermine any possible article in any publication if one simply claims without evidence that the reporter got basic facts wrong. Until someone comes up with contrary evidence, the simplest assumption is that HuffPo got the facts right.<br /><br />Listing a zero basis for a stock you aren't going to be taxed on anyway could be simple sloppiness: after all, the basis is irrelevant for a contribution, so why bother looking it up?<br /><br />On the other hand, this could be evidence of substantive evasion, in which case the smoking gun would be contained in one of the tax returns we have not seen.Robert Westhttps://www.blogger.com/profile/16830743573246446990noreply@blogger.comtag:blogger.com,1999:blog-9208928.post-39125491284972328902012-07-20T13:28:15.808-04:002012-07-20T13:28:15.808-04:00@jpe It's blank on his tax form, you can check...@jpe It's blank on his tax form, you can check yourselfAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-9208928.post-26254672410432361592012-07-20T12:02:48.256-04:002012-07-20T12:02:48.256-04:00Yikes, that would certainly undermine the analysis...Yikes, that would certainly undermine the analysis here.Daniel Shavirohttps://www.blogger.com/profile/14710628584922961682noreply@blogger.comtag:blogger.com,1999:blog-9208928.post-4134122597905592562012-07-20T12:01:19.282-04:002012-07-20T12:01:19.282-04:00The most likely answer to your ending query (how d...The most likely answer to your ending query (how did he get zero basis stock?) is that HuffPo is simply wrong. I'd bet dollars to donuts that basis is reported and that it's more than zero.jpehttps://www.blogger.com/profile/12721892896157356899noreply@blogger.com