Mitt Romney says he's been audited by the IRS. Does that matter?(Read article summary)
The disclosure raises more questions about Mitt Romney's complicated financial holdings – and may renew pressure on him to release more of his tax returns.
In an interview with ABC News over the weekend, in the course of defending his decision not to release any more tax returns, Mitt Romney may have unintentionally thrown a little more fuel on the fire – by revealing that he has been audited. And possibly more than once.
Here’s what Mr. Romney said:
“From time to time, I’ve been audited as happens, I think, to other citizens as well. And the accounting firm which prepares my taxes has done a very thorough and complete job,” Romney said, adding: “I don’t pay more [taxes] than are legally due, and frankly, if I had paid more than are legally due, I don't think I'd be qualified to become president. I'd think people would want me to follow the law and pay only what the tax code requires.”
To be clear: Merely being audited does not in any way imply wrongdoing. And Romney is right that he’s hardly the only citizen to go through it: The Internal Revenue Service says it audits about 1 out of every 8 taxpayers who report more than $1 million in income. That meant that the IRS conducted more than 1.5 million audits in fiscal year 2011.
Still, it’s not an experience most Americans can readily relate to. And we’d wager that the Romney audits were a little more complicated than most.
Reporters have been wondering about Romney's possible audit history for some time. Just last week, Mother Jones ran a piece that questioned whether Romney could be targeted by a task force that the IRS created in 2009 to audit high-wealth individuals who “make use of sophisticated financial, business, and investment arrangements with complicated legal structures and tax consequences” – a description that, the article noted, sounds a lot like Romney.
So far, the task force has audited 36 individuals and found that 24 of them had not, in fact, paid all the taxes they actually owed: “Out of the 36 high-wealth individuals audited in fiscal 2011 and the first five months of fiscal 2012, the IRS discovered an extra $47 million in taxes that should have been paid by 24 people in that group.”
While it’s clear that over the weekend, Romney brought up his audits as a way of implying that his tax forms have been thoroughly scrutinized by the government – and passed muster – he did not explicitly say whether he ever wound up having to pay any penalties or additional taxes as a result of those audits.
So far, the Romney campaign isn't offering much more.
“Mitt Romney has been scrupulous about observing the requirements of the tax code. Mitt Romney is in full compliance with U.S. law and he has paid 100 percent of what he has owed,” campaign spokesman Ryan Williams told Business Insider.
Likewise, MSNBC’s First Read reported: “The Romney campaign will not say what year he was audited – only that he was found to be in compliance and that the audit took place more than 10 years ago.” (Which strikes us as odd, since Romney, in the ABC News interview, clearly seemed to be referencing more than one audit when he said, “From time to time, I’ve been audited.”)
It all raises more questions than it answers – and may put even more pressure on the candidate to release more of his tax returns.