Romney, a multimillionaire, has been under pressure from his rivals for the Republican presidential nomination and others to release his tax information.
After weeks of stalling, Mitt?Romney?did an about-face on Tuesday and said he will release his?tax?returns in April and that they will show he?pays?close to?15?percent?of his?income?in?taxes.
Skip to next paragraphRomney, a multimillionaire, has been under pressure from his rivals for the Republican presidential nomination and others to release the information. He'd previously said he wouldn't release it. He suggested Tuesday that he would make public only one year's worth of information, for 2011.
Speaking to reporters after a campaign stop in South Carolina,?Romney?said most of his?income?comes from investments, not regular wages and salary. The?tax?rate on investment?income?is?15?percent, much lower than the 35?percent?rate applied to wages for those in the highest?tax?bracket.
"What's the effective rate I've been?paying? It's probably closer to the?15?percent?rate than anything,"Romney?said. "Because my last 10 years, I've ... my?income?comes overwhelmingly from investments made in the past, rather than ordinary?income?or rather than earned annual. I got a little bit of?income?from my book, but I gave that all away. And then I get speaker's fees from time to time, but not very much."
Romney?has resisted calls to release his?tax?returns, insisting that he and his wife, Ann, have complied with federal law that requires them to disclose information about their financial holdings.
But in a debate Monday night, Texas Gov. Rick Perry insisted that?Romney?release his returns,?saying?that the party needs to fully scrutinize its nominee now instead of later. Former House Speaker Newt Gingrich said he will release his?tax?information this week.
"I know that if I'm the nominee, people will want to see the most recent year, and see what happened in the most recent year,"?Romney?said, suggesting he'd release the couple's 2011?tax?information. "We'll wait until the?tax?returns for the most recent year are completed, then release them."
Romney's?wealth ? he is worth between $190 and $250 million ? puts him among the wealthiest Americans. But if most of his?income?is from investments, it could help him to significantly lower his federal?tax?bill compared to people who make money in other ways.
The top federal?tax?rate for investment?income?? qualified dividends and long-term capital gains ? is15?percent. By comparison, the top?tax?rate for wages is 35?percent, on taxable?income?above $388,350. Wages are also subject to Social Security and Medicare payroll?taxes.
At?15?percent,?Romney's?federal?income?tax?rate would still be higher than the?tax?rate paid by most Americans.
On average, households making between $50,000 and $75,000 will?pay?a federal?income?tax?rate of 5.7percent?this year, according to projections by the?Tax?Policy Center a Washington think tank.
However, when payroll and other?taxes?are included, that same household would?pay?an average federal?taxrate of 16.6?percent.
Overall, the average American household will?pay?9.3?percent?in federal?income?taxes?? and 19.7?percent?in all federal?taxes.
In the 2008 presidential race, Republican John McCain released two years of his?tax?returns and then-Sen. Barack Obama released six years of?tax?information.
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