Under Pressure, Romney Releases Tax Returns

Reporters, not to mention Mitt Romney's opponents, are still poring through the 550 pages of tax returns the Romney campaign released Tuesday, but thanks to sneak previews granted to a couple publications Monday night, we already have some idea of what facts from the returns will be talked about in the coming days. 

The early looks at the tax returns come from The Washington Post, Bloomberg, and the Wall Street Journal. Romney, taxed at at an effective rate of about 15 percent on an income of $21.7 million for 2010 and $20.9 million for 2011, paid about $3 million in taxes in 2010 and estimates paying $3.2 million for 2011. 

By comparison, Romney donated $7 million to charities over the same two year period. A significant portion of that, at least $4.1 million according to the Post, went to the Mormon church.

The lead story so far seems to be that Romney made no money from wages, the main source of income for most Americans. Watchers of Monday night's debate were clued into that fact when Romney and Newt Gingrich discussed the former's tax rates under Newt's proposed flat tax of 15 percent on all income. Turns out, Romney said, he'd have paid nothing in taxes for the past two years under Newt's plan, which has a zero-percent tax rate for capital gains.

Also of note is Romney's Swiss bank account, closed in 2010. The preview of the returns didn't indicate any significant income from that account, but it's sure to be a subject of scrutiny. Other foreign investments of Romney's are located in some of the greatest hits of tax havens: Luxembourg, Ireland and the Cayman Islands, as the Post points out. 

Reuters has an interesting explanation from Romney's campaign on the foreign holdings (via Talking Points Memo):

Romney advisers stressed that the holdings in the Caymans -- along with those in a Swiss bank account that was closed in 2010 after an investment adviser decided it could be politically embarrassing to Romney -- were reported on tax returns and were not vehicles to avoid taxes.

According to the Journal, Romney listed his occupation as "executive," while his wife was listed as "homemaker." 

As Bloomberg notes, the Romney returns haven't yet revealed anything that unusual compared to the tax returns of the very richest Americans, including the sophisticated maneuvering of investments undertaken on the Romney family's behalf. But for a candidate already struggling to convince voters he understands what life is actually like for the all-important "everyday" American ($10,000 bet, anyone?), his tax returns certainly won't help that image. 

While the foreign holdings and 15 percent tax rate will certainly give Romney's opponents plenty to play with in the coming days and weeks, the returns also reveal some things that could work well for Romney's campaign, in particular the massive amount of money he and his wife give to charity.