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McCain's tax returns

From NBC's Domenico Montanaro
McCain released his tax returns today. They include 2006 and 2007 and nothing previously. In addition, no returns or summaries are included for wife Cindy McCain, who heads a privately held beer distribution company. Also note, John and Cindy McCain have filed separate tax returns for every year of their marriage except their first year, 27 years ago. On questions of transparency, the McCain campaign points out that the Arizona senator has filed financial disclosures while he has been in public life. The campaign cites Teresa Heinz Kerry, John Kerry's wife, as precedent for not releasing Cindy McCain's returns -- even though Heinz Kerry loaned money to her husband's campaign.

But Clinton and Obama have both released their tax returns dating back to 2000 (Clinton released a summary for 2007, but not the full return yet), and Clinton further back than that, since the days her husband was governor of Arkansas in the 1980s. Additionally, the Clinton campaign has recently called on Obama to release his tax returns from 1997 to 1999 when he was an Illinois state senator.

VIDEO: The presidential hopeful reported a taxable income of nearly $259,000 for 2007, a figure that does not include his wife's wealth .  NBC's Kelly O'Donnell reports

McCain reported taxable income of almost $259,000 on his 2007 tax returns.

*** UPDATE *** While Teresa Heinz Kerry did not release her full income tax returns/schedules (in interest of privacy for her children, she said at the time), she did, in fact, release at least a partial return showing her income from 2003.

The New York Times wrote on Oct. 16, 2004: "Ms. Heinz Kerry on Friday released a small part of her 2003 income tax return, unlike her husband, Senator John Kerry, and President Bush and his wife, Laura, who have made their full tax returns available for public inspection. The Kerrys file separate tax returns, a common arrangement when one spouse is wealthy."

Here's the release from the McCain campaign:
ARLINGTON, VA -- Today, U.S. Senator John McCain's campaign released his tax returns for 2006 and 2007.  Senator McCain's tax returns show that he paid $157,231 in federal taxes for 2006 and 2007.  In the past two years, Senator and Mrs. McCain have contributed $340,323 to charitable causes. Below please find summary information about Senator McCain's 2006 and 2007 tax returns.
To view the relevant documents, please see:

BACKGROUND ON THE 2006 AND 2007 TAX RETURNS
Senator and Mrs. McCain have kept their personal finances separate throughout their 27-year marriage. Accordingly, they have for many years filed separate tax returns. However, their home state of Arizona is a community property jurisdiction.  In community property states, individuals maintain a separation of all property brought to the marriage, or inherited during it, but share financial responsibility for other assets acquired through the efforts of each spouse during the marriage. This means that their tax returns report one half of each of their community property income and expenses (such as income each of them earn as salaries, Senator McCain's book royalties, and expenses attributable to both of them such as charitable contributions from community assets).

Accordingly, Senator McCain's 2006 and 2007 tax returns contain a detailed "Statement A" showing the allocation of his and Mrs. McCain's community property income and expenses to their respective tax returns (2006 - 2007). John McCain's 2006 and 2007 tax returns, including the community property income and expense allocation, are available for download below. (2006 - 2007)

Publication 555 from the Internal Revenue Service is also available for download below. This publication explains the community property filing rules for various states (including Arizona) and their effects on married taxpayers filing separate returns. View

SUMMARY OF TAX RETURNS
Taxes Paid:
For 2006, Senator McCain paid $72,771 in federal income, alternative minimum, and self-employment taxes (LINES 57 and 58) on taxable income of $215,304 (LINE 43), which is a 33.8% tax rate. View

For 2007, Senator McCain paid $84,460 in federal income, alternative minimum, and self-employment taxes (LINES 57 and 58) on taxable income of $258,800 (LINE 43), which is a 32.6% tax rate. View

Charitable Contributions:
Senator McCain donates his royalties from his books to charitable organizations. This sum has totaled over $1,800,000 since 1998 when he signed his first book deal. Senator McCain's book income of $256,898 for 2006 and 2007 is comprised of earnings for Faith of My Fathers, Worth the Fighting For, Why Courage Matters, Character is Destiny, and Hard Call.

Beginning in 1991, Senator McCain has also donated the increase in his Senate salary for that year and each subsequent year to charity because he opposed the Congressional pay increase at that time and pledged not to accept the pay raises. The cumulative total of these donations is over $450,000.

2006
In 2006, Senator and Mrs. McCain donated $129,390 from community assets to charity, of which Senator  McCain's one-half allocation was $64,695. This is 19% of his adjusted gross income.

2007
In 2007, Senator and Mrs. McCain donated $210,933 from community assets to charity, of which Senator McCain's one-half allocation is $105,467. This is 27.2% of his adjusted gross income for the year.

Most of Senator McCain's contributions were made to the John and Cindy McCain Family Foundation, which makes direct contributions to charities. The Foundation's tax returns for 2006 and 2007, which include a list of the charities to which Senator and Mrs. McCain contributed through the McCain Family Foundation in 2006 and 2007, are available for download below. (2006 - 2007)

SUMMARY OF SENATOR MCCAIN'S ACTUAL (NOT COMMUNAL) INCOME [FROM STATEMENT A OF TAX RETURN]
 
 2006
 2007
 
Senate Salary:
 $161,675
 $161,708
 
Book Royalty Income:
 $80,390
 $176,508
 
Social Security Income:
 $22,104
 $23,157
 
US Navy Pension*:
 $56,496
 $58,358

* [Non-Taxable and therefore not reported as income on Statement A]

Note About Mrs. McCain's Financial Information:
Since the beginning of their marriage, Senator McCain and Mrs. McCain have always maintained separate finances.  As required by federal law and Senate rules, Mrs. McCain has released significant and extensive financial information through Senate and Presidential disclosure forms.  In the interest of protecting the privacy of her children, Mrs. McCain will not be releasing her personal tax returns.
Note About Hensley & Company:

In her role as Chairman of Hensley & Company, a privately-held business founded by her parents, Mrs. McCain's main areas of responsibility focus on strategic planning and corporate vision.  Having served the greater Phoenix area since 1955, Hensley & Company is widely respected as an exemplary corporate citizen, and makes significant charitable contributions of its own.

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