No one forced Mr. Obama to take all the Bush deductions, most especially given his public contempt for them.
Obama Family Tax Shelter
First family transfers wealth, avoids taxes
President Obama and his wife, Michele, gave a total of $48,000 in tax-free gifts to their daughters, according to tax records made public on Friday.
The president and his wife separately gave each daughter a $12,000 gift under a section of the federal tax code that exempts such donations from federal taxes.
There is nothing illegal about the president’s taking advantage of this tax shelter, but it does raise eyebrows given that he has lamented the myriad tax exemptions used by the wealthy—“millionaires and billionaires” like himself—to pay less in taxes. He has yet to propose a comprehensive plan to reform the byzantine tax code.
The Obama’s tax return indicates that the gifts, likely for their daughter’s college educations, began in 2007, when the maximum exemptible amount was $24,000 per couple. The maximum exemption has since increased to $26,000 per couple.
The Obamas paid a total federal tax rate of 20.5 percent on a gross adjusted income $789,674, which would typically fall within the top federal rate of 35 percent.
According to an analysis of the president’s tax return, he may have paid a lower rate than his secretary despite making more than eight times as much money as she did.
His most recent tax proposal—the so-called “Buffett Rule”—would increase taxes on about 4,000 millionaires and raise about $4.7 billion in new revenue per year, enough to cover about 0.4 percent of the projected budget deficit in 2012. Though the rule would apparently not hit the president himself.
Supporters of the rule have acknowledged that the projected revenue from the “Buffett Rule,” which the Democratic-led Senate is expected to vote down, is “not even a meaningful small amount.”
The Obama’s untaxed gift to their daughters will leave American taxpayers to subsidize the college education of the children of the multi-millionaire Obamas.
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President Obama today released his 2011 federal income tax, with he and his wife reporting an adjusted gross income of $789,674. The Obamas paid $162,074 in total tax – an effective federal income tax rate of 20.5%. The Obamas also reported donating approximately 22% of their income to charity — $172,130.
President Obama has been making a big political push for the “Buffett Rule,” which would require millionaires to pay a minimum of 30% of their income in taxes. To illustrate the point, the president has pointed out that billionaire investor Warren Buffett pays a lower tax rate than does his secretary.
President Obama’s secretary, Anita Decker Breckenridge, makes $95,000 a year. White House spokeswoman Amy Brundage tells ABC News that Breckenridge “pays a slightly higher rate this year on her substantially lower income, which is exactly why we need to reform our tax code and ask the wealthiest to pay their fair share. ”
It should be noted that president would not be impacted by the Buffett Rule, though he would see his taxes go up if the so-called Bush tax cuts on higher income wage-earners were allowed to expire, as the president says he wants.
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What’s more, he paid a lower rate than Vice President Biden, who made less than half what Obama did. Biden paid a 23.2 percent rate on $379,035 in income.
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