Chef Jim Posted July 16, 2008 Posted July 16, 2008 The death tax should be for multi-billionaires... not people with $20 million in assets. There is a principle in life... it's called working hard so your kids don't have to. I have a client new who makes +/- $70k per year. Her mother died just a couple of years ago with a couple hundrend thousand in a brokerage acount, couple hundred thousand in a few annuities and two properties worth just over a million total plus a few things here and there. My client ended up having to liquidate over $100k in assets to pay the estate taxes, some of wich she would have preferred to keep. These people were not rich by any stretch of the imagination. Too bad they hadn't met me before mom died.
BuffaloRebound Posted July 16, 2008 Posted July 16, 2008 And this is roughly the point this thread gets tossed to the dark side. Define "fair." If the average guy is doing alright. Right now he's not and there is no way the estate tax should be repealed when the US is running up $200-300 billion yearly deficits. I can't see how it would be good for the average guy if the the top 1% starts owning 40-50% of the total wealth. I actually think it wouldn't be good for the top 1% either. No one makes money in a vacuum. Consumers to buy goods, military and law enforcement to protect people and property, infrastructure to transport goods and workers, healthcare to make people well enough to work, etc.
Fingon Posted July 16, 2008 Posted July 16, 2008 If the average guy is doing alright. Right now he's not and there is no way the estate tax should be repealed when the US is running up $200-300 billion yearly deficits. I can't see how it would be good for the average guy if the the top 1% starts owning 40-50% of the total wealth. I actually think it wouldn't be good for the top 1% either. No one makes money in a vacuum. Consumers to buy goods, military and law enforcement to protect people and property, infrastructure to transport goods and workers, healthcare to make people well enough to work, etc. The Death tax is one of the most inefficient taxes ever. "A 1994 study found that the estate tax’s 55 percent rate at the time had roughly the same disincentive effect as doubling an entrepreneur’s top effective marginal income tax rate. The estate tax has also been found to impose a large compliance burden on the U.S. economy. Some past economic studies have estimated the compliance costs of the federal estate tax to be roughly equal to the amount of revenue raised—nearly five times more costly per dollar of revenue than the federal income tax—making it one of the nation’s most inefficient revenue sources." http://www.taxfoundation.org/files/sr142.pdf
KnightRider Posted July 16, 2008 Posted July 16, 2008 The death tax should be for multi-billionaires... not people with $20 million in assets. There is a principle in life... it's called working hard so your kids don't have to. There's a guy on the radio in Boston defines super-rich pretty well, as someone who makes more than $10k/year than you.
BuffaloRebound Posted July 16, 2008 Posted July 16, 2008 The Death tax is one of the most inefficient taxes ever. "A 1994 study found that the estate tax’s 55 percent rate at the time had roughly the same disincentive effect as doubling an entrepreneur’s top effective marginal income tax rate. The estate tax has also been found to impose a large compliance burden on the U.S. economy. Some past economic studies have estimated the compliance costs of the federal estate tax to be roughly equal to the amount of revenue raised—nearly five times more costly per dollar of revenue than the federal income tax—making it one of the nation’s most inefficient revenue sources." http://www.taxfoundation.org/files/sr142.pdf I have a hard time believing the estate tax prevents someone from starting a new business. An unnamed 1994 study isn't too convincing neither are 'some past economic studies'. In 2000, federal estate tax receipts were $29b and state receipts were $8b. The 2004 IRS expense budget for the year was $10billion.
obie_wan Posted July 16, 2008 Posted July 16, 2008 I have a hard time believing the estate tax prevents someone from starting a new business. An unnamed 1994 study isn't too convincing neither are 'some past economic studies'. In 2000, federal estate tax receipts were $29b and state receipts were $8b. The 2004 IRS expense budget for the year was $10billion. gotta love the liberals. better to let the government redistribute the wealth as they see fit. of course, we could always use the method employed by the Catholic church to prevent a build up of assets by families - just prohibit all males from being able to marry and legally pass on property. a little sex with kids is a small price to pay for wealth re-distribution
Gene Frenkle Posted July 16, 2008 Posted July 16, 2008 gotta love the liberals. better to let the government redistribute the wealth as they see fit. of course, we could always use the method employed by the Republican Party's Base to prevent a build up of assets by families - just prohibit all males from being able to marry and legally pass on property. a little sex with kids is a small price to pay for wealth re-distribution As many here are so fond of saying... Fixed
gmac17 Posted July 16, 2008 Posted July 16, 2008 "meager $3.5m exclusion", $7m for married couples. I love that... meager $3.5m. What's a multi-millionaire to do? Put the inheritance tax up for a referendum vote like gay marriage. I'm sure the average guy has a lot of sympathy. yeah, but the average guy doesn't go out there and bust his ass and build up a thriving business. The average guy sits on an internet message board and bitches about how the rich keep getting richer. A family business worth $3.5 million is nothing out of the ordinary- they are all over the place. Add in the people who work their ass off and invest wisely and by the time they are 90 years old the wonder of compound interest has made them worth $10 million.
BEAST MODE BABY! Posted July 16, 2008 Posted July 16, 2008 Philosophically, I am opposed to the "death tax," "estate tax" or whatever else someone wants to call it. The government has already taxed your income. They tax dividends. And then, as your last goodbye, they want more. This story is about the Steelers. But we all know this could affect Buffalo's ownership too. The super-wealthy already provide a majority of tax revenues. The death tax on top of that just seems spiteful. But hey, it's easy for people to hate the rich. It's only because they don't think they have what it takes to become rich themselves...otherwise they would.
/dev/null Posted July 16, 2008 Posted July 16, 2008 The government has already taxed your income. They tax dividends. And then, as your last goodbye, they want more. 2 things in life are certain, death and taxes. One is just better at taking advantage of the other
BillsWatch Posted July 16, 2008 Posted July 16, 2008 Are we not lemmings? Bingo! But call it a death tax and see the masses flock to repeal it. What sound do lemmings make? Bahhhhh! There are already many legal ways around it and much inheritance income grew tax free. What supporters do not want is ANY tax. Take it away and you need to make it up somewhere. Call the replacement "working man lunch tax" or something as palatable as "death tax".
Fingon Posted July 17, 2008 Posted July 17, 2008 One of the biggest problems with the Death Tax is that it hits people who have assets worth something and not a lot of free cash. This forces them to liquidate their assets.
Arkady Renko Posted July 17, 2008 Posted July 17, 2008 One of the biggest problems with the Death Tax is that it hits people who have assets worth something and not a lot of free cash. This forces them to liquidate their assets. When the estate tax had a lower exemption, a family farm in my family hand's for generations had to be sold off down in Maryland because suburban sprawl in the DC-Baltimore area had jacked up nearby property values. It was my great-grandfather's farm that he had barely held on to during the depression. He had 8 children who had worked along aside him, sometimes continuing to do so as adults. They were not going to get a windfall, but the tax looks at the estate, not among how many people the property is going to... they had to sell it and it is now a sprawling subdivision full of McMansions.
Arkady Renko Posted July 17, 2008 Posted July 17, 2008 What sound do lemmings make? Bahhhhh! There are already many legal ways around it and much inheritance income grew tax free. What supporters do not want is ANY tax. Take it away and you need to make it up somewhere. Call the replacement "working man lunch tax" or something as palatable as "death tax". "There are already many legal ways around it and much inheritance income grew tax free." The only significant money that grows tax free are in retirement accounts besides stock appreciation, which are hardly much for someone with a high net worth. The only issue is with appreciated stock which has the basis of the FMV at death. It would not be hard to change that rule so that capital gains cannot be avoided (of course capital gains ignores inflation as is). There being ways around it is precisely one of its main problems. Much money is simply diverted to estate planners who come up with the next creative way to avoid estate taxes. Then new tax rules come on, wasting everyone's time for a pretty low revenue producing tax. Inherently, it requires restrictive controls on how people dispose of their property during both life and death. Wealth can be used for power during life (see all the rich men and women running for Congress), can be wasted on extravagance, and it can be given to someone's family. I am not really sure why the latter should be penalized more than the first two. Outside of my anecdote, I doubt I will ever even be indirectly affected by the estate tax, and when I am struggling and working hard I can resent the trust fund babies, but I am not sure our tax system should be built around envy and spite.
leh-nerd skin-erd Posted July 17, 2008 Posted July 17, 2008 If the average guy is doing alright. Right now he's not and there is no way the estate tax should be repealed when the US is running up $200-300 billion yearly deficits. I can't see how it would be good for the average guy if the the top 1% starts owning 40-50% of the total wealth. I actually think it wouldn't be good for the top 1% either. No one makes money in a vacuum. Consumers to buy goods, military and law enforcement to protect people and property, infrastructure to transport goods and workers, healthcare to make people well enough to work, etc. smoke....mirrors...mirage. the average guy is only average when he's like you. when he's not like you, he's one of "them". and some people think it's ok to take 'their' stuff, because it means you dobn't have to give up 'your' stuff. i really struggle to understand where you're coming from on this issue. i certainly don't want to toss out labels, or engage in word play, but your statement confounds me. granted, it's only a line or two and can't summarize your entire thought process, but if I read you correctly, you're of the opinion that the government is actually doing people a favor by not allowing the transfer of wealth intergenerationally? at the same time, it's fairly clear you see the assets they have as not really theirs, but perhaps property of the collective whole? i'd always try and put it in this perspective. how much more are you, a presumably average guy, willing to give for the good of the cause? or, perhaps maybe you already give most of it back? you live on a nominal amount of money for basic sustenance food, water, shelter, internet access-----and the rest goes to the public good? because i have to believe, if you have time to enjoy the Buffalo Bills, you must at least a transistor radio that allows you to tune in once in a while. and, figuring that, i figure there are people worse off than you, and surely they'd look at your transistor radio and think---man, that guy has it good! you could help them by giving up more than you do already--nothing prevents you from doing so. as i watch political figures toss out catch phrases like 'eliminating tax breaks for the rich' and 'benefiting the working people of America', and at the same time take a gander into their personal lives----be it guys with 4 houses telling me to conserve, or guys in multi-million dollar estates talking about the poor and impoverished of the world, or of people making a hundred million dollars and seeing fit to only give back 6 or 7 % to charitable causes while speaking passionately about the great unwashed and what they need---it strikes me as inconceivable that they are not viewed as the biggest hypocrites in the world. nothing at all stops them from doing more---a ton more. how about beginning to eliminate the fraud and waste in government before proposing some three card monty tax plan that purports to get it from the wealthy while at the very same time taking another 10-15% off the top of the average guys capital gains, or shaking him down for a little bit more on his interest income. and before you go thinking i'm moving to idaho to start up a day camp for right wing militia types----you are 100% accurate that taxes are a necessary part of life and, if handled with some degree of fiscal responsibilty when implemented---a privilege to pay. when we help pay for safe roads to drive our minivans on, and that's honorable. we pay for streetlights and the police and helping people who need help. it costs a ton to run this gigantic amusement park, and we should do our part. but, please, spare me the rhetoric about helping out the working class until you at least try to fix the corruption inherent in what we are already spending. anyways, someone mentioned it above. just like ted kennedy's kids will continue to enjoy the seasonal compound(s) sprinkled across the country, using a vast fortune that was initially compiled by their great-grandfather (how'd they bypass that nasty estate tax problem??)----there was a way for ralph to avoid this whole estate tax issue, or at least lessen it. business succession planning takes place everyday, and he had the resources to plan accordingly.
Lurker Posted July 17, 2008 Posted July 17, 2008 "meager $3.5m exclusion", $7m for married couples. I love that... meager $3.5m. What's a multi-millionaire to do? Put the inheritance tax up for a referendum vote like gay marriage. I'm sure the average guy has a lot of sympathy. Talk to any farmer or small business owner about how fast "meager" comes into play when their land/company ownership is considered part of the estate. There are thousands upon thousands of small firms and farms worth more than the exclusion threshold.
Chef Jim Posted July 17, 2008 Posted July 17, 2008 Talk to any farmer or small business owner about how fast "meager" comes into play when their land/company ownership is considered part of the estate. There are thousands upon thousands of small firms and farms worth more than the exclusion threshold. And that will be why life insurance is go big in rural areas.
Pyrite Gal Posted July 17, 2008 Posted July 17, 2008 Lest folks make the false assumption that it is only the poor who want to soak the rich who favor what luntz et al have successfully dubbed the death tax note that the extremely wealthy such as Warren Buffett and 118 other fat cats have strongly come out in favor of inheritance taxes. Buffett went on record saying: "Without the estate tax, you in effect will have an aristocracy of wealth, which means you pass down the ability to command the resources of the nation based on heredity rather than merit," Buffett told the New York Times in 2001. "[Repeal would be like] choosing the 2020 Olympic team by picking the eldest sons of the gold-medal winners in the 2000 Olympics." Buffett also joined a campaign in 2001 to preserve the estate tax alongside 119 other wealthy Americans, including George Soros and Bill Gates' father, William H. Gates, Sr.. Details can be found at > http://money.cnn.com/2007/11/13/pf/taxes/b...e_tax/index.htm < Folks very rich, very poor and in between see value in the estate tax. The problems thrust upon the relatively few folks (even if it is thousands of farms we are talking within a base of 300 million people which would make 3 million farms at 1% relatively few) whose family farm wealth is a problem there would seem to be a targeted solution which gets at solving these few problems rather than allowing the Donald Trumps of the world hide behind these intrepid family farmers. The simple fact is that if you are going to spend 3 trillion on a war you choose in Iraq the money has to come from somewhere. The estate tax with it sizable exemptions and can be avoided if one chooses to donate the money to a reputable charitable cause (or even create a real irrevocable charity which runs the Bills for the benefit of the WNY community- one would need to fight the NFL which would prefer to stop future Green Bays but as Cleveland demonstrated the NFL can be beat) and really is a solvable problem despite the WSJ's politically motivated slant.
scribo Posted July 17, 2008 Posted July 17, 2008 This is what happens when Frank Luntz and his crew of wordscribes gets a hold of ways to manipulate the masses. Most people were in favor of the 'inheritance' tax because they ascribed to the theory that if you earn your money, you should be able to keep it and do with it as you will. However, keeping money 'in the family' from one generation to another - so to speak - is a sure fire way to build an aristocratic elite. This particular tax truly only affects a small segment of the very richest of society. Well, I am just a poor football fan and I am being affected.
obie_wan Posted July 17, 2008 Posted July 17, 2008 The estate tax with it sizable exemptions and can be avoided if one chooses to donate the money to a reputable charitable cause (or even create a real irrevocable charity which runs the Bills for the benefit of the WNY community- one would need to fight the NFL which would prefer to stop future Green Bays but as Cleveland demonstrated the NFL can be beat) and really is a solvable problem despite the WSJ's politically motivated slant. running a NFL franchise is not a charitable activity. avoiding the estate tax by giving up the assets being taxed to a charity only solves the problem if your goal was give away all of your assets to 3rd parties. probably not the original intention. you must have worked for the Vatican in a prior lifetime.
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