THE BATTLE OVER THE ESTATE TAX
While the debate over the “fiscal cliff” has largely focused on the expiration of 2001 and 2003 income tax relief, lawmakers’ failure to take action before January 1 would also result in a massive expansion of the estate tax (a.k.a. the “death tax”).
Currently, estates valued at less than $5.12 million are exempted from paying the tax – while any estate valued above $5.12 million is taxed at 35 percent. Those levels were set during the administration of George W. Bush – and extended two years ago as part of a bipartisan compromise.
Beginning on January 1, 2013, however, estates valued at $1 million or more will be taxed at a whopping 55 percent – which amounts to a massive $532 billion tax hike over the coming decade. U.S. President Barack Obama – who seems eager to push the country over the fiscal cliff – isn’t offering much in the way of a compromise, either. Under Obama’s proposal, any estate valued at $3.5 million or more would be taxed at 45 percent – a plan that has been endorsed by U.S. Speaker John Boehner.
Other liberals – including investor Warren Buffett – want a $2 million cap and escalating rates beginning at 45 percent.
None of these plans are satisfactory.
We support the repeal of the estate tax. Whether via income, property or dividend levies, this is money that has been taxed once (sometimes twice) already. Taxing it yet again is wrong – and represents yet another disincentive to wealth creation.
First imposed in 1797 to fund America’s Navy, the estate tax was repealed in 1802. It reappeared during the Spanish-American and Civil War, though, with its current iteration hitting the books in 1916 as a means of subsidizing America’s involvement in World War I.
It’s time to get rid of it entirely …
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32 comments
It’s time to get rid of it entirely …
Fuck that. This is a tax that solely affects the rich. Strip the tax off of them and the revenue will either have to be made up by taxing people who aren’t rich even more or by pushing even more draconian cuts in necessary programs.
If the rest of us have to eat spending cuts and program changes that directly affect us negatively, then the rich can take a bite of the turd sandwich too.
Whether via income, property or dividend levies, this is money that has been taxed once (sometimes twice) already. Taxing it yet again is wrong – and represents yet another disincentive to wealth creation.
There’s so much shit wrong with this it isn’t even funny. Everyone who purchases property pays income and property taxes. This tax is an additional charge on only a specific subset of those properties. In other words, government is acknowledging that properties valued above a set amount should be taxed at a higher rate than others. This tax isn’t charged immediately, rather it is assessed after the person dies, which primarily benefits those “wealth creators” as the tax doesn’t even hit until after they are dead and buried. The persons it hurts are the beneficiaries, who may or may not have done anything to help “create” the wealth they are receiving.
For fucks sake, receiving an estate valued at millions of dollars, even if you only receive a fraction of its value, is more than enough to be well off. If the beneficiary wants to be as rich as the deceased person they should put forth the effort and generate their own damn wealth, then they can get their own multi-million dollar property and only have to pay income/property taxes and the like for it.
Maybe if to be rich you had to earn it rather than be born into it, this country would be better off. Then again, that’s quite a strong “maybe.”
I also like how it is a supposed disincentive to “wealth creation” as if some guy is going to refuse to become an obscenely rich billionaire businessman because he’ll lose 45% of what his estate is worth AFTER he dies.
Written like someone who wants everything handed to him by government, and paid for by others. You might have a better understanding of this if you were actually financially successful (or had someone in your family who was), and had kids for whose future you were concerned. Something tells me none of that will ever apply to you, Smirks.
LOL…
Written like someone who wants everything handed to him by government, and paid for by others.
Bullshit.
I grew up in a poor family who didn’t take welfare to get by. I know what it is like to live in a slum of a house praying for one meal a day. I know what it is like to start from nothing, work full-time while going to college full-time, and establishing a decent career, all through hard work. Quite honestly, I got enough lucky breaks to not have to need help from anyone to get to where I am today. I know others aren’t nearly as lucky and get dealt an even shittier hand than I originally had, though, so I want to make sure the people who need help get it.
I already go through life with an assumption that Social Security and Medicare won’t be there for me when I retire, despite the fact that I’ll probably pay into it most of my working life, primarily because Congress is bought and the buyers don’t want those programs to stay.
The thing is, those who buy Congress don’t give a shit if the age for Medicare is raised or if Social Security is slashed even if those outcomes could be avoided by fairly simplistic means. They also demand those programs be gutted, harming millions of people in the process, but at the same time demand having their own taxes lowered. All the pain to the plebes, and all the gain to those who already have more than enough to get by, and God forbid they have to chip in to anything government does for the whole of society.
You might have a better understanding of this if you were actually financially successful (or had someone in your family who was)
sid, don’t try to second guess who I am or how well off I am or how well off any of my family members are, asshole. I’m quite successful, as are plenty of those in my extended family, not that any of that matters to you.
and had kids for whose future you were concerned.
Oh no! I don’t know how my kids are going to make it if they don’t inherit 100% of my $12 million estate! Why, they might only get $1-$2 million each after taxes are done! They’ll have to settle for a 4,200 square foot house and a Lexus, or if they want more, they might actually have to go out and EARN it! Oh the humanity!
And here you are telling me how I likely don’t know what the fuck to do with myself if gubmint don’t give me free shit! Hilarious! We have to protect people who have properties valued at millions of dollars, but god forbid you assholes born with jack shit ever ask for a hand up!
I want my kids to grow up knowing the value of a hard day’s work. Of course I want to provide something for them to make their life a bit easier, especially if they fell on hard times, but I don’t have to give them a fucking fortune to do that. I want my kids to grow up knowing they have to be self-sufficient and to live on the fruit of their own labors. They don’t need to inherit a piece of a million dollar estate to live a decent, fulfilling life.
“GAWD! That asshole commie librul socialist Smirks! He came from a family of bums and is nothing but a welfare leech who doesn’t give a shit about his kids!”
You must be fun at parties.
Smirks, why don’t you blame the real problem — overspending — rather than direct your long-winded rant at “the rich.”
You basically are arguing that rich people should foot the bill for their government’s wasteful spending. And, yes, it is a double tax. Estate money is not being spent on a piece of property, but rather it’s being taxed again for simply existing.
Your class envy is very apparent.
I do believe spending needs to be cut, however revenue also needs to be increased. The deficits we have experienced since Bush have been a creation of decreased revenue (primarily caused by tax cuts on the rich, followed up by the recession dropping revenues further) and increased spending. We can no longer afford the spending we are doing, but neither can we afford the massive tax breaks to the rich.
You basically are arguing that rich people should foot the bill for their government’s wasteful spending.
I’m arguing that the tax rates should return to their levels during the Clinton era and that government should be scaled back as necessary so that spending will fall behind the amount of revenue those tax levels would generate. I’m arguing for a balanced budget that is balanced by living within our means, not one that is balanced by slashing every program we have just to make sure those most well off get to keep as much money as possible.
I’m also arguing for the rich having to pay more in effective income tax rates so that they aren’t paying a smaller percentage than the middle class (i.e. no 13.9% effective tax rates when many of us pay more) and for the larger corporations to pay more than just a little or nothing in taxes when small businesses can’t get even half the loopholes/subsidies they do.
I’m not asking for Uncle Sam to break the back of the billionaires for “social justice” or “class envy,” I’m asking for Uncle Sam to stop tilting the board in favor of the wealthiest entities and actually run its shit properly.
And, yes, it is a double tax. Estate money is not being spent on a piece of property, but rather it’s being taxed again for simply existing.
It isn’t taxed for simply existing, it is being taxed for being transferred. If transferred to a charity, that tax usually is not assessed, ergo it isn’t being taxed “for simply existing.”
Smirks- Guess you never tried to sustain a family business.
No, Smirks, not bullshit. You have an axe to grind against those that are successful, and who want to pass on their success to their heirs, because you lack that level of success. You came from little and have scratched your way to some. Good for you. I came from little and have scratched my way to more, and intend to keep scratching.
You have freely admitted you want the government to pay for your things, and you freely admit you want the wealthy to pay more than they do. Your hatred of the wealthy permeates most of your posts.
“I want my kids to grow up knowing the value of a hard day’s work.”
Wow! Did you come up with that inane platitude all on your own? I want my kids to grow up knowing that, if they succeed well beyond the norm, they won’t get shafted by people like you who want the government to take care of everyone.
“Of course I want to provide something for them to make their life a bit easier, especially if they fell on hard times, but I don’t have to give them a fucking fortune to do that.”
And I don’t want people like you deciding how much I can give my kids. I made it and paid my taxes on it, but now you want to stick your hands into my pile to take whatever you think is “fair.”
“They don’t need to inherit a piece of a million dollar estate to live a decent, fulfilling life.”
Feel free to determine what you think your kids “need.” It will likely be considerably less than what I want to leave my kids, whether they need it or not.
Tell you what, how about you let me find the panel of folks to determine what you or your kids “need” to live a decent, fulfilling life? What you consider to be all you “need” is probably exceptionally extravagant to countless others.
Keep spouting off the leftist boilerplate arguments, then screaming “I’m not a Socialist!” That never gets old.
Sid says: “You have an axe to grind against those that are successful, and who want to pass on their success to their heirs, because you lack that level of success”.
I say: how would you know how successful Smirks is? As he argues his point better than you, from what little I can judge, he is more successful than you. Certainly wiser.
I think you should stop these types of personal attacks.
Thanks for the suggestion, LRB. I see you offer commentary on my exchange with Smirks, but nothing of substance. Since I don’t recall seeing you post here before, I’ll presume you are new to FITS. For your edification, this is the place where personal attacks thrive. I don’t know of anyone who posts here regularly who hasn’t stuck his toe into the waters of personal attacks, including Smirks. It’s fun, so maybe you need to loosen up a little.
Since very few here reveal their true identities, the attacks can hardly be taken seriously. Unless, of course, you have a thin skin, in which case this is probably not the place for you.
That said, based on what I’ve seen Smirks post, I doubt he is much more than marginally successful. Perhaps no longer living paycheck-to-paycheck, but I doubt he is raking it in. Nothing wrong with that, of course, but it might explain why he is so jealous of the truly successful. Really, he should be happy with what he has accomplished, rather than lash out constantly at the wealthy.
As for you, I imagine you are ideologically in line with Smirks, so I could not possibly care less of your opinions of me. You seem less able to engage in substantive discussion than Smirks, but who knows? Perhaps if you actually try to write something, you may surprise me. I guess we’ll see.
Hugs and kisses.
sid, whatever my kids need, they can go out and earn themselves. And they can pay the taxes that they owe on whatever they earn and form their own opinions about everything regarding government’s role, spending, and taxation. I’m not deciding shit for my kids, that’s entirely up to them. Whatever help I give them is irrelevant.
If the estate tax isn’t to your liking, we can always remove it and replace it with some other tax increase, but expect almost any alternative to be much more dependent on the middle class’ funds, which will have a much more devastating effect on the economy. Either way, revenue shouldn’t decrease unless spending decreases with it.
Oh, and I really am happy with what I’ve got. I don’t give a shit what kind of preconceived notions you have about me or your little power trip with making sure you tell people how much better off you are compared to them. I just don’t like paying a higher effective rate than people like Romney, nor do I like it when they propose tax plans that clearly benefit them and clearly harm a majority of Americans. And yes, I do think the rich should pay an actual higher effective rate, not just the same, but I’d gladly take a system where they at the very least pay the same effective rates as it would be a vast improvement over what we currently have. (I find myself repeating this shit over and over to you, but it doesn’t seem to have taken hold yet.)
At the very least, I afford you the assumption that you believe what you believe because you honestly feel it will benefit America as a whole, no matter how mistaken I feel you are in those beliefs. It is rather unfortunate you don’t extend that level of decency to anyone you disagree with.
Sid….this may be a hostile place, but you often cross the line. It is hard for me not to want to hurt you.
As for where I stand on this issue, I think the wealthy should pay more taxes.
Sorry, Smirks, but your arguments fall on deaf ears. You want big government, cradle-to-grave style, and you just can’t stand those more successful than you. It oozes from every post you make.
You do care what I think about you, no matter how much you deny it, because I’ve had you pegged every time. It’s not a power trip when I state I’m better off than others, as I haven’t said that. I’ve said I’m smarter than most, and said I own three houses. It’s you who has determined that must mean I’m better off. If that’s what you use to judge success, then that’s just more evidence of the jealousy I’ve ascribed to you.
Finally, I have no problem with people who disagree with my views. I just don’t think self-righteous blowhards like you have earned the level of decency you demand, but don’t offer to others. You are a ridiculous hypocrite, and deserve little more than scorn.
Gee, LRB, you sound like you need professional help. Like I said, you may not be suited for FITS. If you can’t handle the hostile environment without an urge to hurt people, then I guess you are even less of a man than I thought. And I already thought you were a pissy little girl. Go figure.
Well Sid, let me return the psychological hostility. I think you are an arrogant over-confident righteous blowhard, of limited functional intelligence, that has probably inherited any success from daddy-dear. You have a learning disability and limited education (you fuckin’ sure don’t write well) and are dogmatic and stubborn. You probably don’t have a current girlfriend and are divorced. Your mom is probably dead from dealing with your shit and you have few male friends outside of business.
I want to know where to buy that 4200 sq ft house and the Lexus on “1 or 2 million”. Then try to send a couple of kids to school. Maybe in Pelion.
You have an incredible chip on your shoulder. Wasn’t there a movie in which one character said to another, “You should have inherited your money, it would have made you a nicer guy”, or something to that effect. Resentment and jealousy will eventually eat you up. Be happy with your life. As Judge Smails said, “The world needs ditch diggers too.”
Well, LRB, I don’t think it’s really “psychological hostility” to suggest that someone who says they find it difficult to not want to hurt another person might need professional help. Especially when I’ve never said anything directly to you, until you decided to start with your own personal attack. I was having a rather tame exchange with Smirks when you, apparently, decided he needed your “help” in the discussion.
Nonetheless, your ham-fisted “analysis” is so far off the mark that it suggests you may be borderline retarded.
I’m married with kids, so there’s strike one.
My dad died in debt, so there’s strike two.
My mom died from heart failure, likely due to several decades of smoking, followed by several decades of obesity. She and I got along quite well, and while I left home at 18, as one should, I visited regularly, and even helped her financially in her later years. Strike three.
As for your comments about my writing, opinions vary. I don’t do much professional writing these days, but I have been published, was an editor, and at the height of my output, my work was read by somewhere in the neighborhood of a quarter million people on a weekly basis.
I’m not sure what qualifies as “few” to you regarding male friends, but I would say I have far more outside work than inside.
You did get one thing correct, though. I am stubborn. But I’m reasonably sure I’ve owned up to that here before, so that really doesn’t score for you.
So, as I said, I’m not sure this is really the place for you. You are a qnew poster (wink, wink), but I presume a longer visitor. I can’t imagine you haven’t seen others post here in a hostile manner. Hell, Smirks does it. If you can’t handle the tone that is regularly in place here, you may want to take your dolls and go home. Just a suggestion.
Lester, I think it’s obvious that the “winner of this debate” depends on whether you lean conservative or liberal. Obviously, someone who leans liberal, like yourself, is going to eat up everything Smirks is saying. He’s preaching to the very choir you are sitting in.
I don’t overly respect folks with hand-me-down wealth. It does not challenge these persons to be their best….to make a contribution to society. That’s the disincentive I see.
The proposed $3.5 million exemption is fine for me, and I suspect, every other person on this site.
If anybody here would be hit by this, they could be spending their time better “creating wealth & jobs” for the rest of us.
The original exemption before Bush was for $1 million, but that was over a decade ago. The exemption should at least be keeping in step with rising average housing values, though I don’t believe it should be at its current level of $5 million.
Sid is getting slapped around again by Smirks for the nth time.
Sid, if you want to even the score, maybe you should unleash your usual psychological analysis. It’s so entertaining.
I think your knees are getting a little scraped and bruised from your interactions with Smirks.
Don’t you know that guys like Steve Fobes, a real nitwit, whose claim to fame is he inherited a bundle for his ol man
Thank God every day for these Right Wing types looking out for them?
Personally I couldn’t care less if some multi billionaire like Forbes pays a little more!
Al Gore’s dad wuz reel poor, too…
Wealth was something that remained in the family in the old country, usually passed on to the first born son in primogenitur. Titles passed the same way; Earls and Dukes and the like.
That’s fucking un-American.
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I’m sure that the liberal, elitist Buffett/Soros/Gates/Clinton Gaggle will shelter their wealth in “Foundations.” That way, they get to employ their children and shield them from taxes, too. Just ask Chelsea how much she got paid to help “manage” the “Clinton Foundation…”
It seems a lot of folks don’t realize that the estate tax directly benefits the upper middle class through the “step up” in tax basis at death. Many folks avoid a lot of capital gains on vacation homes, businesses, stock, etcetera without paying one dime in estate taxes.
I’d be fine without an estate tax if the capital gains rate was more in line with the wage rate (as Steve Forbes once allegedly said, wages are for suckers) and appreciation was taxed upon gratuitous transfer.
$5M ($10M for a couple) affects very few people and there are easy, legal ways to leverage that amount to sheild more from estate taxes.
Why should a person who honestly earned a good living, payed taxes on every dime, saved and invested wisely, and lived within his means, not be entitled to convert his entire net worth to gold and throw it into the ocean if he so chose? Some of these comments are frightening.
Of course,none of this shit is worth reading,but for some weird reason,I hold out false hope…http://www.youtube.com/watch?v=Usl-h5f-8W0