02-08-2012, 03:45 AM
Bill in NC wrote:
The article seems to say that the trust was funded by Romney's after-tax dollars.
And that Mitt is currently paying the taxes so the trust assets can accumulate.
After his death the kids still pay income tax from trust earnings, since it is a pass-through entity.
In their case trust income will probably be from investments, so they'd likely be taxed mostly at the long-term capital gains rate (15% this year, but rising to 24% in 2014)
If instead the trust held commercial buildings that were rented the kids would pay at ordinary income rates.
Plus any state taxes based on where they reside.
[quote=Ted King]
like the Romney children - is that they could live off of their trust fund money without paying any federal taxes at all. That's just flat out wrong.
Here's the whole quote of mine that you excerpted from:
The most troubling aspect of this for me, though, is the move by a Republican politicians in general to push for getting rid of estate (inheritance) tax, corporate taxes and capital gains taxes altogether. What that would do for the very wealthy - like the Romney children - is that they could live off of their trust fund money without paying any federal taxes at all. That's just flat out wrong.
Notice the part that I put in bold this time about the push to get rid of taxes like capital gains taxes. Since I mentioned that specifically I don't understand why you brought up that they would probably be paying capital gains taxes. As to some kinds of investments like rental properties - notice that (I also put in bold this time) I said "could". That is, I didn't say they would, I said the could. If there were no capital gains taxes as many Republican politicians are pushing for, the Romney kids could live off the income from their trusts without paying any federal taxes. And notice that (I also put in bold this time) I was specifically referring to federal taxes - I didn't say anything about state and local taxes. So I'm not sure why you mentioned those.