Jeb Bush Tax Returns – A Closer Look at Unreviewed Companion Documents

Update: Within 2 days of this initial post the Wall Street Journal, Washington Post and numerous other major publications did extensive stories on this post.

Disclosure:  Parish & Company maintains no ties to any Presidential candidate and has a long history of impartial analysis regarding the financial disclosures of political candidates at the local, statewide and national level.  Feel free to use this analysis.  Of course a minor balanced quote is always appreciated and helps me participate in the dialogue.

This week Presidential candidate Jeb Bush released 33 years of tax returns as he desperately tries to avoid the “Romney effect.”   Surprisingly, this is the first time no one has asked me to review his, a major candidates, return.  And so I’ll go ahead and make a few observations and also say that I would be glad to consider reviewing the returns if asked.


Jeb Bush on Campaign Trail Romney’s mistake was simple, he pretended to be a job creating benevolent leader when in reality he was a ruthless financial engineer tax cheat, whose efforts at Bain Capital eliminated hundreds of thousands of jobs via a roll up merger strategy aggressively manufacturing and trafficking net operating losses created via the issuance of non qualified stock options.

All he needed to do was come clean and say, if elected, he works for the people and will distance himself from his natural constituency, which is aptly able to take care of itself.

Bush needs to similarly come clean and say, look, I am not the average guy and my tax rate is not really 40 percent, as the WSJ reported.  Including social security is misleading because that is a trust I will one day draw upon.

Using the same logic many small business owners in Oregon could claim a rate of 65 percent, that is 16 percent FICA, 40 percent federal and 9 percent state tax. Bush could also state that the definition of lobbying should be expanded to include consulting and require in the future that candidates disclose consulting clients representing more than 5 percent of their income.

This is especially important given the trend of major government figures working for foreign entities.  Even two former Chairs of the Federal Reserve, Greenspan and Bernanke, work for foreign firms, what might have been considered treason in a prior era.

Bush’s achilles heel regarding his return is a companion disclosure not addressed yet by any media outlet.  This is his pension plan for his “sole proprietorship” consulting business.  Its publicly available EIN is 20-8492304.

Bush used a very tax planning aggressive two prong strategy that has allowed him to take the following pension tax deductions for 2009 thru 2013, totaling $1,886,600.   2013:$288,500   2012:$326,500  2011:$472,400   2010:$423,400   2009:$377,800.  He uses both a Defined Benefit plan with aggressive retirement assumptions, assuming he would retire at 62, in addition to a 401K Profit Sharing plan.

Of this total, $1,508,000 pertains to the defined benefit plan and approx $378,000 to the profit sharing 401K.  Regarding the 401K, approx $246K are employee contributions.   It is possible that Bush’s son is the other participant in the defined benefit plan yet based upon other documents, it also seems quite possible Bush is the primary participant in terms of dollars.

The defined benefit plan lists two participants for each year while the profit sharing plan lists 5 participants.  This in itself is odd since DB plans have key anti discrimination rules and one would think all 5 employees in the profit sharing would also be participants in the defined benefit plan.

Remarkably, the plan document for the defined benefit plan defines eligibility as “All employees excluding non-resident aliens,  non-highly compensated employees  and members of an excluded class and union.”  One would think that Bush would not exclude “non highly compensated employees,” i.e ordinary workers.

And so this poorly concocted attempt by the WSJ to say Mr. Bush high taxes paid “may help inoculate him from the kinds of attacks faced by Romney” is foolish.  Again, Bush needs to explain the specific here given that the average self employed person faces much lower contribution limits.  His plan advisor and actuary follows: Pension Actuary: kevindonovan Kevin Donovan of Pinnacle Plan Design, LLC PO Box 634130, Tuscon, Arizona  85728-4130,  Tel: 520-618-1305, Email: