Your Money: Are the Bush-era tax cuts good for all Americans, or just investors?

Mitt Romney, if elected President, vows to keep the Bush-era tax cuts. And he wants to layer in a bigger corporate tax break - in a bid to jumpstart the economy.

More than any other presidential candidate, Romney also has benefited handsomely from these cuts - the lower capital gains and dividends taxes - and he will likely do so again if they are maintained.

So are these tax cuts good or bad for the rest of us? Good, if you're an investor. In fact, all investors should be aware of the Bush tax cuts' implications, described below.

Without another extension, the low rates that former President George W. Bush signed into law will skyrocket at the end of this year as scheduled, says Bill Smith, managing director in CBIZ MHM national tax office in Bethesda, Md. "Does this create a conflict of interest for Romney? Absolutely," says Smith, because they benefit Romney enormously.

First, Romney paid a 14 percent effective overall tax rate, much lower than many middle class folks pay. One reason is the Bush tax breaks for capital gains.

Generally speaking, investment gains are taxed at 15 percent. Bush argued the low rates would help encourage saving and investment. If the Bush tax cuts expire at the end of 2012, that 15 percent tax rate would rise to the ordinary income rate of 39 percent. Long-term capital gains taxes would rise from 15 percent to 20 percent.

The tax code's treatment of income from partnerships in private equity, hedge funds and real estate development means that some of the country's wealthiest people are taxed at a lower rate than bus drivers and nurses. Romney is among the top earners - because the bulk of his taxable income came from investments, not from a salary.

Romney's compensation from Bain Partners, his private equity firm, was lavish: Tax filings released by his campaign show Romney received more than $20 million a year in 2010 and 2011, mostly via investment income.

If the Bush tax cuts weren't in effect for 2010 and 2011, Romney would have paid another $2.5 million in taxes, according to Smith's analysis (see chart).

Charity tax savings