Apparently there is another way Mitt Romney is allegedly avoiding taxes.
Romney has set up a trust for his children and grandchildren that technically does not qualify as an inheritance, Bloomberg's Jesse Drucker reports. As a result, Romney has been able to legally sidestep estate and gift taxes. The top gift tax rate is 55 percent.
Romney has been criticized for allegedly sidestepping taxes in other ways. He holds investments abroad, including in the Cayman Islands, and a Swiss bank account -- where he does not need to pay U.S. taxes. Romney paid a 14 percent tax rate in 2010 and 2011. Middle-class households paid a 16 percent tax rate on average in 2010.
In this case, he has moved about $100 million into the family trust, which does not count toward his $250 million net worth, and it has grown in value with income from Romney's various investments, according to Bloomberg. It is unclear how much Romney has saved in gift and estate taxes.
Critics also have slammed Romney for refusing to release more than two tax returns -- from 2010 and 2011 -- which The Huffington Post's Mark Gongloff notes are not the interesting ones.
At the same time that Romney's being accused of avoiding taxes, he's also been criticizing ordinary Americans for the way they pay their taxes. Romney said in a recently leaked video at a May fundraiser that 47 percent of Americans "pay no income tax," "will vote for the president no matter what," and "believe that they are entitled to health care, to food, to housing, to you-name-it."
Though it is true that 46 percent of Americans pay no income taxes, they still pay many other taxes. The poorest fifth of Americans paid an effective tax rate of 17 percent last year, and they pay double the state and local tax rate of the top one percent.
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