Romney's $6 million tax returns shine a light on wealth

TAMPA, Florida - The Associated Press

Republican presidential candidate, former Massachusetts Gov. Mitt Romney. AP Photo

Republican presidential candidate Mitt Romney paid about $3 million in federal income taxes in 2010, having earned more than seven times that from his investments which places him among the wealthiest of American taxpayers.

At the same time, Romney gave nearly $3 million to charity about half of that amount to the Mormon Church which helped lower his effective tax rate to a modest 14 percent, according to records his campaign released early Tuesday.

For 2011, he'll pay about $3.2 million with an effective tax rate of about 15.4 percent, the campaign said. Those returns haven't yet been filed yet with the Internal Revenue Service.

The former Massachusetts governor had been under pressure in recent weeks to release his tax returns, his Republican opponents casting him as a wealthy businessman who slashed jobs in the private sector. Rival Newt Gingrich made public his returns on Saturday, showing he paid almost $1 million in income taxes a tax rate of about 31 percent.

Romney's campaign confirmed the details of his tax information after several news organizations saw a preview of the documents. He had said he planned to release his returns in full Tuesday morning, and campaign officials would be prepared to discuss them in detail with reporters.

"You'll see my income, how much taxes I've paid, how much I've paid to charity," Romney said during Monday night's debate in Tampa. "I pay all the taxes that are legally required and not a dollar more. I don't think you want someone as the candidate for president who pays more taxes than he owes." Romney's 2010 returns show the candidate is among the top 1 percent of taxpayers. The returns showed about $4.5 million in itemized deductions, including $1.5 million to the Church of Jesus Christ of Latter-Day Saints.

Before the tax records were released, Romney's old investments in two controversial government-backed housing lenders stirred up new questions at the same time his campaign targeted Gingrich for his work for one of them, Freddie Mac.

Gingrich earned $1.6 million in consulting fees from Freddie Mac even though Romney has as much as $500,000 invested in the U.S.-backed lender and its sister entity, Fannie Mae.

The fight over releasing the tax information highlighted an argument that Democrats are already starting to use against Romney that he is out-of-touch with normal Americans. And it likely hurt him in the South Carolina primary, where he lost by 12 percentage points to Gingrich after spending several days resisting releasing the returns.

On Monday, Romney would not answer questions from debate moderator Brian Williams about just what pieces of his tax returns could cause political headaches. But they will shine the spotlight on a fortune estimated at between $190 million and $250 million, and could raise questions about where he keeps his money and how he earns it.

For example, Romney keeps some of his personal fortune in investments that are domiciled in the Cayman Islands, where many international investors shelter their income from American taxes. Romney aides say he doesn't use the funds to avoid or put off paying the appropriate taxes.

The returns could also reveal more details about his annual take as founder of the Bain Capital private equity firm.

But it's clear that Romney's campaign is bracing for an onslaught of criticism of his personal fortune. His wife, Ann, has started talking about the returns during campaign appearances. She told supporters at a Florida rally Sunday: "I want to remind you where we know our riches are. Our riches are with our families." Most of Romney's vast fortune is held in a blind trust that he doesn't control. A portion is held in a retirement account.