Washington was gripped by budget battles in 2012, and now new documents show it wasn't the best financial year for the Obamas, either.
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The president and first lady released their 2012 federal income tax return, posting an adjusted gross income of $608,611, and paying $112,214 in total taxes. Last year was the least profitable for the Obamas since taking office; when he first took office in 2008, Obama reported an income of $2,656,902, mainly from residuals from his book.
The president’s effective federal income tax rate sits at 18.4%. Reforming the tax code to force higher-income Americans pay more in taxes was a hot topic during the 2012 election season with Republican challenger Mitt Romney’s tax returns becoming a main focus. Romney’s effective tax rate is 14.8%.
In the 2014 federal budget the president unveiled on Wednesday, he called for the implementation of the so-called "Buffet Tax" that would require households with incomes of more than $1 million a year pay at least 30% of their income (after charitable giving) in taxes. The rule's namesake, billionaire investor Warren Buffet, made headlines when he called for tax reform in 2011 because he was paying a lower tax rate than his secretary, Debbie Bosanek, who reportedly pays a 35.8% tax rate.
The tax documents show the first family donated $150,000 to more than 30 charities, and took the mortgage rate deduction for their Chicago home.
The couple’s Illinois income-tax return showed them paying $29,450 in state income tax.