WASHINGTON -- Mitt Romney on Friday released a letter from his tax accountant, PricewaterhouseCoopers, promising that Romney paid an "average annual effective federal rate" of 20.2 percent over 20 years. The number is being released instead of the tax returns themselves, and is being used to rebuff Senate Majority Leader Harry Reid's charge that Romney didn't pay taxes over a 10-year period.
But it is a meaningless figure.
According to the letter from PwC avowing the number, it is based on Romney's adjusted gross income. That means that, for instance, if Romney made investment profit of $20 million, but had losses of, say, $19.9 million, his adjusted gross income would only be $100,000. Paying 20.2 percent of $100,000 would cost Romney just over $20,000.
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