As George Will and many others have noted, there must be something truly damaging in Romney’s pre-2010 tax returns for him to willingly endure the criticism and scrutiny that has accompanied his refusal to release them—a refusal he reiterated on Friday, even as the issue, and the matter of his departure date from Bain Capital, has engulfed the campaign. “The cost of not releasing the returns are clear,” Will said on ABC’s This Week on Sunday. “Therefore, he must have calculated that there are higher costs in releasing them.”

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When the stock market collapsed in 2008, the wealthiest investors fared worse than everyone else. (See, for instance, this Merrill Lynch study.) The “ultra-rich”—those with fortunes of more than $30 million—fared worst of all, losing on average about 25 percent of their net worth. “There was really nowhere to hide as an investor in 2008,” Merrill Lynch’s president of global wealth management pointed out in 2009. “No region ended the year unscathed.”

As a member of the ultra-rich, Romney probably wasn’t spared major losses. And it’s possible he suffered a large enough capital loss that, carried forward and coupled with his various offshore tax havens, he wound up paying no U.S. federal taxes at all in 2009. If true, this would be politically deadly for him. Even assuming that his return was thoroughly clean and legal—a safe assumption, it seems to me—the fallout would dwarf the controversy that attended the news that Romney had paid a tax rate of just 14 percent in 2010 and that estimated he’d pay a similar rate in 2011.

The “zero tax in 2009” theory—again, this is sheer speculation—gains further sustenance when you consider it’s the only year for which nobody knows anything about Romney’s taxes. He’s revealed what’s in his 2010 and 2011 returns, and he reportedly submitted 20-some years’ worth of returns to the McCain campaign when he was being vetted for vice president in 2008. Steve Schmidt, McCain’s chief strategist in that campaign, said on MSNBC last night that while he didn’t examine Romney’s returns himself, nothing that McCain’s vetters found in them disqualified Romney from consideration.

http://www.businessweek.com/articles/2012-07-17/whats-romney-hiding-in-his-tax-returns