FLASHBACK 1992 - Ad to Accuse Bush of Tax Loophole Ploy | WHAT REALLY HAPPENED

FLASHBACK 1992 - Ad to Accuse Bush of Tax Loophole Ploy

An independent political action committee is scheduled to begin airing television advertisements today accusing President Bush of exploiting a loophole to substantially reduce his personal tax bill over the past decade.

The ad--a copy of which was provided to The Times--attempts to move toward center stage an issue which has rumbled around the periphery of the presidential campaign all year: whether the President has tried to avoid state income taxes in Maine, where he maintains his Kennebunkport family home, by claiming legal residence in Texas, which has no state income tax.

Bush does not own a home in Texas; he sold his Houston residence in 1981 after he was elected vice president and purchased the Maine house from his aunt. At that point, he claimed Kennebunkport as his principal residence--which would have allowed him to avoid paying capital gains taxes on the sale of his Houston home--but the IRS rejected his argument.

Now, he maintains a Houston hotel room as his legal address for voting and tax purposes. To settle a legal challenge to his voting status in Texas, Bush said in 1985 that he intends to build his retirement home on a small vacant lot in Houston after leaving office.

By claiming his residency in Texas rather than Maine, Bush has avoided paying more than $200,000 in Maine state income taxes since 1981, the ad maintains. "For 11 years, George Bush has been less than honest," the ad asserts.