Romney’s LDS Tax Loophole, Broken by Bloomberg

Bloomberg obtains new information about Mitt Romney’s taxes and… well, the story comes out when everyone is distracted by imminent disaster. It’s too bad, because this is as thorny and irritating a tale of tax law chicanery as you’re likely to read.

Romney used the tax-exempt status of a charity – the Mormon Church, according to a 2007 filing – to defer taxes for more than 15 years. At the same time he is benefitting, the trust will probably leave the church with less than what current law requires, according to tax returns obtained by Bloomberg this month through a Freedom of Information Act request.

In general, charities don’t owe capital gains taxes when they sell assets for a profit. Trusts like Romney’s permit funders to benefit from that tax-free treatment.

Read the whole thing, but also ponder this: Romney’s Mormonism was supposed to hurt him in the general election, and there’s no sign that it’s doing so. In the South, where he should be weakest (recall that he won no deep South primaries until the field emptied out), he’s polling better than John McCain did and close to where George W. Bush did. There is still no evidence of Democrats concocting any anti-Mormon messaging. I definitely hear it, sometimes, when I talk to Protestant voters. But it’s not turning out to be a factor in their Romney-or-Obama considerations. The fact that Romney’s huge charitable giving is led by large donations to the church has hurt him not a whit.