Mitt Romney Tax Return Reveals GOP Candidate Outsourced Payroll, Shielding Household Labor Costs

Republican presidential candidate, former Massachusetts Gov. Mitt Romney speaks at Pueblo Weisbrod Aircraft Museum in Pueblo,
Republican presidential candidate, former Massachusetts Gov. Mitt Romney speaks at Pueblo Weisbrod Aircraft Museum in Pueblo, Colo., Monday, Sept. 24, 2012. (AP Photo/Bryan Oller)

WASHINGTON -- GOP presidential nominee Mitt Romney released his 379-page tax return for 2011 on Friday. Enclosed were the names of his foreign investments, the addresses of his Cayman Islands interests, and the performance of his Goldman Sachs funds. Absent, however, was any information about the household help the Romneys employ to maintain their various estates.

This lack of transparency stands in contrast to Romney's 2010 return, which listed $20,603 in wages paid to four "household employees" all in one state, presumably Massachusetts. Household employees include "babysitters, drivers, nannies, caretakers, health aides, private nurses, cleaning people, housekeepers and yard workers," according to the IRS.

Romney left the 2011 form detailing payroll taxes for his household help blank, attaching a note to explain that they would be reported quarterly on a separate form. A campaign spokesperson told The Huffington Post that the task had been outsourced to a payroll company.

There is no financial benefit or penalty associated with filing this information every three months instead of once a year. But, as with his 2010 tax return, Romney is utilizing a narrow definition of the term "tax return" to avoid releasing some of his tax documents to the public. In 2010, for instance, Romney declined to release a form associated with his Swiss bank account. While required by the IRS, the foreign bank account form is filed separately from the tax return, allowing Romney to withhold the document while boasting about his campaign's transparency for releasing a year's worth of tax returns.

Experts questioned the timing of the move and its nature.

"Maybe it's just one less thing that he has to show," Charles J. Russo, a professor at Towson University's accounting department, told HuffPost. "It's just one small step to show less rather than more."

Russo added that Romney's decision to file quarterly is perfectly legal.

The Romney campaign said via email that the decision to file household help taxes separately was meant to make the Romneys' taxes easier to manage. "This method makes record-keeping easier," the spokesperson said.

But this simpler record keeping also shields Romney's household help arrangements from public scrutiny. As HuffPost reported in January, the Romneys paid just $20,603 in wages for household labor in 2010.

The figure raised concerns that the family was underpaying the help, as the going rate for full-time household labor in Massachusetts is $40,000 to $50,000 a year. For a family with houses in Massachusetts, New Hampshire and California, that relatively low number is likely due in large part to the Romneys' decision to outsource maintenance on their homes to contractors who are responsible for payroll taxes. The Romneys' tax return only lists employees who the family paid directly, and the 2010 document states that all of the family's employees live in a single state. These direct payments were outsourced in 2011 to a payroll company.

The decision to outsource the household payroll also shields the identities of Romney's household employees from the public. Romney opted not to redact the names of his four household employees from his 2010 return. The highest-paid of those is Kelli Harrison, who received $8,667. Harrison is not a housekeeper for the Romneys. In fact, she works for both the Romney campaign, as a special assistant to Mitt and Ann, and for Romney's political action committee, Free and Strong America PAC. Her $8,667 in household wages were for her duties as a "personal assistant," according to the Romney campaign, which were unrelated to political activities.



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