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Monday, April 14, 2003

Good old boys

It's tax time again across this great land of ours, and if you need a break from wrestling with your own taxes, take a look at George W. Bush's 2002 federal income tax return over here (pdf file) and Dick Cheney's over here. They're quite an eye-opener.

The Bushes reported income of around $856,000. They showed wages of nearly $400,000, and a whopping $436,000 in interest income. About $425,000 of interest came from W.'s blind trust, called "the Lone Star Trust." The return doesn't say exactly what that trust has invested in, but I recall reading somewhere that there were quite a few Treasury bonds in there. The end result was a federal tax bill of roughly $269,000 for the year, around 31% of the Bushes' adjusted gross income.

Overall, the Bushes' return isn't very revealing. A personal tidbit: the first couple still claims its twin 21-year-old daughters, Barbara and Jenna, as dependents. That's to be expected with them in college.

The Cheneys' return is more interesting. I remember, when Dick became V.P., how everyone said he was taking such a substantial pay cut by going back to work for the government. That is undoubtedly true, but from the looks of his tax return, old Dick is managing to eke out a living. He and his wife made more than $1.1 million in income last year, plus more than $559,000 of tax-exempt bond interest, and they rolled over nearly $1.6 million in pension distributions, presumably into one big-ass IRA.

Wonder why the Bush administration is so hot to eliminate the income tax on dividends? Check out the $491,000 in dividends on the Cheneys' return. At a top federal tax rate of 38.6%, that cost them nearly $190,000. If the full Bush tax cut goes through, that's another $190,000 a year the Cheneys won't have to pay to Uncle Sam, on top of the federal taxes they already save by investing in tax-sheltered bonds. (In contrast, the Bushes had dividends of only around $24,000. They are apparently way more into taxable bonds than into stocks, tax-exempts or mutual funds these days.)

In the end, the Cheneys wound up paying around $341,000 in federal tax. That's about 29% of their adjusted gross income, not including the tax-exempt bond interest. With the tax-exempt interest counted in, their tax rate was about 20%.

Charitable contributions are another interesting aspect of the returns. The Cheneys gave $122,000 to charity on an income well over $1.6 million; the Bushes, about $70,000 on income of more than $850,000.

Neither couple was subject to the alternative minimum tax (AMT).

The bottom line on the Bushes' form is telling -- they didn't sign their own tax return. It looks like they had some guy from Northern Trust Co. sign for them as their attorney.

It must be nice.

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