A Question on Cheney's 2005 TAXES.

[file83]

From this Yahoo News article:

The Cheneys reported adjusted gross income of nearly $8.82 million, which was largely the result of exercising stock options that had been set aside in 2001 for charity.

The Cheneys donated just under $6.87 million to charity from the stock options and royalties from Mrs. Cheney's books. That left about $1.9 million in income on which the Cheney's owed $529,636 in taxes.

Over the year, the Cheneys paid $2,468,566 in taxes through withholding and estimated tax payments. As a result, the Cheneys are entitled to a refund of $1,938,930.

Wait a minute, the numbers don't add up. Can someone please explain this to me?

Cheney's adjusted gross income was $8.82 million.

The Cheney's donated $6.87 million to charity.

So, $8.82 - $6.87 = $1.95 million (this matches the estimate of $1.9 million in the article)

So, now the Cheney's have about $1.95 million left over AFTER donating to charity.

Explain to me then how the Cheney's only having $1.95 million, were able to pay $2.47 million in "withholding and estimated tax payments"?

How can you give money to the government that you don't have?

[cynatnite]

1. This site has cheney's downloadable tax returns...

http://www.msnbc.msn.com/id/12318056

maybe seeing them first hand will help you out.

[SlipperySlope]

2. I think you are assuming...

I think you are assuming that the donation to charity in 2005 had to be completely funded by 2005 income.

[rzemanfl]

3. Unlike us riff raff, they have savings. n/t

[Yupster]

4. When Cheney's stock options were exercized

Haliburton probably withheld 20 % or so.

That's where the giant overpayment would come from.

Most companies require withholding on stock option exercises. This is to prevent someone from exercizing $ 250,000 in stock options and then not having the tax money to pay next April. Instead the government gets the tax up front through withholding.

[cosmicdot]

5. did the Cheney's contribute to any right-wing think tanks?

as part of their 'charitable' donations?

... just wondering ...

Heritage Foundation is, too. Heck, Heritage takes stock donations. Those foundations which fund the right-wing think tanks, i.e., the Sarah Scaife Foundation, etc., probably are, too. Recycle those right-wing dollars.

I couldn't get the Cheney return to open at the msnbc link poster #1 provided.

Lynne is affiliated with the American Enterprise Institute (on payroll, isn't she?), which according to the AEI website is "a 'public charity' under section 501(c)(3) of the Internal Revenue Code, which means that donations to AEI receive maximum tax benefits".





"AEI is an independent, nonpartisan organization supported by tax-deductible contributions from corporations, foundations, and individuals."

"As a tax-exempt educational organization governed by Section 501(c)(3) of the Internal Revenue Code, AEI is generally prohibited from attempting to influence legislation in the U.S. Congress or other legislative bodies."

http://www.aei.org/support/filter.all/default.asp
http://www.aei.org/support/filter.,contentID.20038142216500138/default.asp
http://www.aei.org/about/filter.all/default.asp

[onenote]

6. its a bit confusing, but here's what I think

Cheney's income included $7.4 million in "earned income" made up of his Veep salary, possibly some of the income earned by his wife, and the proceeds of certain stock options which were treated as "earned income" under the tax law. He also had $450,000 (approx) in interest and dividend income, another 1/2 million in capital gains (not sure if this relates to the stock options or not), $344,000 in "rental,etc." income, and $39,000 in business income (probably Lynne's). In addition to the withholding on his salary, Cheney made estimated tax payments of $10K and had taxes withheld by Halliburton on the stock options. The reduction in the Adjusted Gross Income from $8.82 million to $1.96 million is attributable in large part to the charitable deduction which included the net proceeds of the stock options and, apparently, some of Lynne cheney's book royalties. Presumably, if Cheney owns property somewhere, it also included a deduction for property taxes and possibly, for state income taxes.

Unfortunately, you can't really tell that much from the published return because its only the 1040; it doesn't include any of the schedules.

onenote

[file83]

7. Yeah, confusing is right. Cheney probably has more "loop holes"

than a Nike shoe factory.