A rocky day for Romney as money questions persist

By Kasie Hunt

Associated Press

Published: Thursday, Jan. 19 2012 3:41 p.m. MST

Recognizing the threat, Romney has assailed Gingrich's claims that he helped President Ronald Reagan create jobs. He says Gingrich is living in "fantasyland."

Regardless of the outcome of the primary Saturday, the former Massachusetts governor's past 10 days have played into the hands of Democrats who are looking to paint him as an out-of-touch multimillionaire during the general election.

In the meantime, Democrats planned a series of news conferences to argue that the work Romney did at Bain Capital wasn't the same as bolstering American manufacturing.

President Barack Obama's campaign advisers contend voters are unlikely to back a wealthy Republican with financial-industry ties at a time of lingering economic distress.

The questions about Romney's wealth began last week in New Hampshire when he told an audience he knew what it was like to worry about being "pink-slipped" and losing a job. A day later, he said, "I like being able to fire people who provide services to me" — a comment about health insurance companies that his rivals used to paint Romney as out of touch with ordinary Americans.

In a moment that was clearly unscripted, Romney disclosed for the first time Tuesday that, despite his wealth of hundreds of millions of dollars, he has been paying taxes in the neighborhood of 15 percent, far below the top maximum income tax rate of 35 percent, because his income "comes overwhelmingly from investments made in the past."

During 2010 and the first nine months of 2011, the Romney family had at least $9.6 million in income, according to a financial disclosure form submitted in August.

The maximum marginal U.S. income tax rate of 35 percent applies — in theory more than practice — to households with taxable income of over about $388,500.

Like many wealthy people, the Romneys have been helped by changes in federal tax policy that have placed much lower tax rates on investment income — from dividends, interest and capital gains from the sale of stocks and other assets — than on wages and salaries.

Under the Bush-era tax cuts strongly supported by most Republicans, such investment income, including gains on securities held for a year or longer, is subject to a tax rate of 15 percent.

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