Mitt Romney has used the tax-exempt Mormon Church to defer his own taxes via a shelter known as the charitable remainder unitrust, Bloomberg reports.
These trusts grow tax-deferred and give the creator a steady stream of income; what's left goes to charity upon his or her death.
In this instance, Romney used the tax-exempt status of a charity -- the Mormon Church, according to a 2007 filing -- to defer taxes for more than 15 years. [...] Romney’s CRUT, which is only a small part of the $250 million that Romney’s campaign cites as his net worth, has been paying him 8 percent of its assets each year. As the Romneys have received these payments, the money that will potentially be left for charity has declined from at least $750,000 in 2001 to $421,203 at the end of 2011.
In 1997, Congress imposed limits on how much these trusts could pay out and how much must be given to charity. But, Bloomberg reports, Romney was allowed to keep his trust because he created it in 1996.