Minnesota Governor Releases His Tax Returns

Gov. Mark Dayton voluntarily released his tax returns Thursday, showing he earned $385,000 in 2015.

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By Rachel E. Stassen-Berger

Gov. Mark Dayton voluntarily released his tax returns Thursday, showing he earned $385,000 in 2015.

As reflected in past tax returns he released, Dayton, the scion of the Dayton's department store fortune, earned most of his income -- more than $200,000 -- from capital gains.

The Democratic governor had previously released all his tax returns every year, going back to his 2010 campaign for governor. But he said last year that he would stop the pattern because he was no longer planning to be a candidate for anything.

Last week, however, he told the Pioneer Press he had changed his mind in light of Democratic presidential candidate Hillary Clinton's goading of Republican presidential candidate Donald Trump to release his returns.

According to the returns from last year, Dayton paid $73,098 in federal taxes and $32,931 in state taxes. That means he paid an effective tax rate of about 30 percent.

"The effective tax rate is lower than published federal and state income tax rates, because income from dividends and capital gains is taxed at a lower federal rate than earned income. Governor Dayton opposed that differential tax treatment of different sources of income, when he was a U.S. senator," Dayton's office said in a statement. Dayton also championed a higher tax rate for high-income Minnesotans, which increased the taxes he paid to the state.

Neither Dayton's 2014 tax returns, also released Thursday, nor his 2015 tax returns show any deduction for charitable gifts. However, his office said the governor "made more than $10,000 in charitable contributions in 2015 but did not report them to his tax preparer." That level of donations would be about average for someone of his income.

Asked, through a spokesman, to which charities Dayton donated the $10,000 and to confirm that Dayton donated nothing to charity in 2014, the governor declined to answer.

"The governor has released his tax return(s) in full for both years. He has no further comment," spokesman Linden Zakula said.

The governor's lack of large reported donations to charities has previously been an issue.

In 2013, Dayton's tax returns revealed that he had given just $1,000 to charity in 2012 in a year when he earned more than $343,000 in income. He said he was disappointed in himself for that low amount and promised to be more generous in future years. The next year, he gave $10,000 to charity.

Dayton did not provide more information when asked about any inheritance he received upon his father's death, Bruce Dayton. Bruce Dayton, a former executive at the family's retail empire, died late last year. The probate period on the will ended in 2016.

A copy of Bruce Dayton's will obtained by Minnesota Public Radio does not specifically name a dollar amount inherited by his children. The will does say, however, "I have intentionally made only limited provision herein for my children or their issue as I have previously provided for them."

David Montgomery contributed to this report.

(c)2016 the Pioneer Press (St. Paul, Minn.)

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