The antiquated estate tax

Why does America insist on robbing rightful inheritances?

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America is about to do something to families that not even Russia or China do: pillage their inheritances.

The so-called estate tax – more pejoratively referred to as the “death tax” – is set to skyrocket Jan. 1 – from 35 percent to 55. And on a whole lot more families, as well: Currently, the tax applies to estates of $5 million or more; next year, it will extend to estates of $1 million or more.

The American Farm Bureau reports that means the tax will cover 97 percent of family farms.

The estate tax is a relic of class envy that not even Russia or China hold onto anymore.

It punishes families who have risked their capital and plied their sweat and tears to build businesses and work the land. And it is just another disincentive – albeit a huge one – for people to invest and grow businesses.

The estate tax often forces families to liquidate businesses and farms, robbing generations of families from carrying on
beloved enterprises they’ve grown up working for and nurturing.

It’s quite simply un-American at any level, and should rightfully be completely done away with. Yet this country is actually looking at increasing it.

How discouraging, when you can point to communist countries that have more family-friendly policies.

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burninater
9949
Points
burninater 11/26/12 - 11:01 am
3
3
Put your thinking caps on,

Put your thinking caps on, folks.

The estate tax has been at or above the 55% rate for multiple generations in the twentieth century. It affects 97% of family-owned farms.

As of 2007, 96% of farms in America are family owned.

Please, for one moment, think.

If something that destroys family farms has existed for generations, how in the name of all that is holy can we still have a 96% family farm ownership rate in this country?

For the love of God people, START THINKING.

dahreese
4914
Points
dahreese 11/26/12 - 11:06 am
5
3
At techfan
Unpublished

Most of the commentors against your posts above think of themselves as being in the top one percent of the country.

When in reality, they're mostly living from hand to mouth and their families will be lucky to inherit the family vehicle.

nofanofobama
6993
Points
nofanofobama 11/26/12 - 11:08 am
6
1
tech- to have capital gains

tech- to have capital gains taxes ..you have to sell assets...to be able to buy items such as land etc ..you had to have income that already was taxed..with capital gains there is also a risk of capital loss..tech, yes they can transfer large amounts of unrealized capital gains now, but as soon as they sell them it will be taxed ...why cant libs wait..

nofanofobama
6993
Points
nofanofobama 11/26/12 - 11:13 am
6
1
so if you are right, burns,

so if you are right, burns, whats the point?..its not yours or the govt. right to take it. its already been taxed it belongs to the family...the greed of the left has got to end..

dichotomy
37683
Points
dichotomy 11/26/12 - 11:17 am
7
2
Techfan is simply one of

Techfan is simply one of those who feels that the government should seize private individuals' property and assets upon their death. He has obviously never been through an estate settlement. Here is the bottom line. If you inherit an estate next year that is worth $1 million, by the time you pay 55% inheritance tax, executor or lawyer fees or both, appraiser fees, and real estate commissions and/or auction fees from having to sell the propterty and equipment to pay the taxes, probably selling it for less than it was worth because of the time limit to pay the taxes, YOU WILL BE LUCKY TO CLEAR 25% of the estate's value. The Death TAX costs you 75% of the estate and if it was a farm of small business you have also lost all of the future income you might have made.

Any Death TAX is simply insane for estates at $1 million dollars and a 55% Death TAX is totally unreasonable for ANY estate value.

burninater
9949
Points
burninater 11/26/12 - 11:27 am
4
2
nofan, the estate tax is not

nofan, the estate tax is not a product of "the greed of the left". It has existed, and thrived, throughout the 20th century regardless of which side of the spectrum controlled Congress. Estate tax repeal has only beome a serious topic since 2001.

And what is my point about the obvious fallacy that it has destroyed the family farm? Seriously? My point is that IT'S A LIE. Nothing wrong with discussing the morality of the Estate Tax, but for pete's sake, we're adults. Let's try to discourage the current political tendency to simply lie whenever we hope to acheive a result.

nofanofobama
6993
Points
nofanofobama 11/26/12 - 11:48 am
5
1
i grew up in iowa what you

i grew up in iowa what you are saying is factually in accurate..and if it affects just 2 or 3 percent it is too many, even if effect just one its way too many. we have cut capital gains far b/4 2001 and its because of inflation.. ..it is not i repeat, not the govt business what i leave my family...its already been taxed....

Jon Lester
2480
Points
Jon Lester 11/26/12 - 11:53 am
2
2
Jane Doe 1
60
Points
Jane Doe 1 11/26/12 - 12:24 pm
3
4
LOL!
Unpublished

While I'm certain there may be one or two posters here that the estate tax would affect I'm even more certain that the other 98% of us don't and never will make enough money to have to worry about the estate tax. This is Fox News brainwashing at it's best!

The estate tax has no relation or impact upon small business owners or businesses in general as it is a tax upon the personal estate of a decedent. Some argue that estate tax is unfair because it likely results in "double taxation" which means that the money being passed on was in all probability taxed as it was earned and then will be taxed a second time at death. However, this is a tax that does not harm anyone as estates less $1.5 million (2005) and $2 million are exempt from this tax. Again how many of you have MILLION dollar estates?

Lastly, It's amazing to hear those who complain the loudest about lazy welfare cheats, favor the inheritance of huge amounts of money by people who most likely haven't done squat to earn it. Using AC logic Okay, so you think it IS fair that someone like Paris Hilton will inherit millions and not pay taxes on them while you get to pay 25 cents of every dollar you actually earn?

dichotomy
37683
Points
dichotomy 11/26/12 - 12:55 pm
5
1
Jane Doe 1..... you are

Jane Doe 1..... you are simply wrong. "The estate tax has no relation or impact upon small business owners or businesses in general as it is a tax upon the personal estate of a decedent."

The vast majority of small businesses are soley owned by an individual, who pay their income taxes as an individual, and whose estate includes that business and all of it's assets. The private estate of a small business OWNER, and all OWNERS of privately owned FARMS will, in fact, be subject to the 55% Death Tax on that business or farm if the appraised value is over $1 million dollars. If they happen to be a partner in a business or farm, the appraised value of their SHARE of the business or farm is included in their estate and DEATH TAX.

And you would probably be surprised how many people there are that do have $1 million worth of property/equipment that don't have a dime in their pockets at the end of the week. To quote an article from CNBC's website "An average American can have 1 or 2, or even 3 million dollars and not be wealthy”. But if their land and equipment is appraised at or above $1 million, 55% will come off of the top......after the forced sale if their kids don't have the cash to pay the taxes.

burninater
9949
Points
burninater 11/26/12 - 12:57 pm
3
4
JD raises a point I was going

JD raises a point I was going to as well, about incentives to work and innovate vs handouts. Even Ayn Rand was down on inherited wealth, saying the only person who merited inheritance was the person who wouldn't need it to succeed in the first place.

It doesn't address the moral standpoint, but from a thriving economic standpoint, I have to take JD's side in this. Decrease reliance on inherited wealth and you get more Bill Gates. Increase reliance on inherited wealth and you get more Paris Hiltons.

burninater
9949
Points
burninater 11/26/12 - 12:59 pm
4
4
dichotomy, you still aren't

dichotomy, you still aren't addressing the plain fact that after generations of estate taxes near or above 55%, NINETY-SIX PERCENT of farms are STILL family owned. This narrative that it destroys family farms/businesses simply is not true.

Jane Doe 1
60
Points
Jane Doe 1 11/26/12 - 01:05 pm
2
3
dichotomy...
Unpublished

Estate taxes, as the name implies, are paid by the estate - the dead person, not you. For most middle-class folks, there is an exemption that excludes you from paying Federal Estate Taxes (the "Gifts and Estate Tax" but consult your tax adviser to see if you are covered. There may be State Estate taxes to consider as well.

Some States may have an inheritance tax, however, so consult your tax adviser as well, too.

But in general, most of us "little people" pay little or nothing in terms of Federal Taxes on inheritances.

Death Tax? This misnomer is a loaded-word cooked up by partisan Republicans (like Death Boards, which they also cooked up) to try to do damage to their opponents. The proper phrase is Estate Tax. It is not unreasonable to expect heirs to pay some taxes on unearned income, especially when it is of such high sums as the Estate Tax proposes. It does not in any way affect most Americans, only those with astronomical incomes.

justthefacts
25501
Points
justthefacts 11/26/12 - 01:06 pm
5
2
Faulty Logic

So, because it might not effect them, that individual shouldn't care about it's fairness or not? Got it. Fox News brainwashing.

seenitB4
98779
Points
seenitB4 11/26/12 - 01:13 pm
6
0
Hint

If you have valuable timber land....give it to your children before you die.....

Jane Doe 1
60
Points
Jane Doe 1 11/26/12 - 01:15 pm
2
6
You know...
Unpublished

The old saying that "democracy fails when the people discover they can vote themselves money" applies equally to tax cuts as to spending increases. It is something conservatives should take note of. Their penchant for tax cuts is just as damaging as the supposed penchant of liberals to spend lavishly. There is no real difference...

Note that as taxes have been cut several times since the 1970s, the only real beneficiaries have been those in the top 1%. If you check out how those at the top have fared in the past 30 years, as compared with the Average Joes, you see that more and more of our nation's wealth is being concentrated in the hands of a very few people, and they clearly want to keep it that way and then some. Reagan's concept of "trickle down economics" is a failure in that while the middle class sees depression like economic numbers, those at the top remain in relative boom times even now. As far as I can tell their argument that "increasing our taxes will cost jobs" is a sham because

1. these people are sitting on mounds of cash as it is.
2. some 99% of "small businesses" are not in the greater than $250/yr tax bracket.
3. our government cannot afford to keep shoving money into the Club for Growth members' pockets, particularly if all they are going to do is sit on the money.

All I can say is conservatives have found a way to destroy our democracy than having government spend itself into oblivion. Their continual obsession with cutting taxes will achieve the same end because as you will note while they assure us there are spending cuts out there, what they have identified to date is small potatoes compared with the magnitude of the taxes that have been cut since the G. H. W. Bush administration. The Club for Growth is a clear poster child for this lavish excess.

Humble Angela
41338
Points
Humble Angela 11/26/12 - 01:19 pm
6
2
Why are the left so hateful
Unpublished

Why are the left so hateful to successful people "since it only affects 2% of the people...screw them!" I thought the left fought for the minorities? What happened to that?

And Jane.... You said "Still no need to hoard it all to give the kids million dollar inheritances they didn't work for and won't really appreciate in the long run."

So how is it morally superior for the government to take that money and give it to people that didn't work for it and won't really appreciate it in the long run?

Humble Angela
41338
Points
Humble Angela 11/26/12 - 01:20 pm
6
2
"All I can say is
Unpublished

"All I can say is conservatives have found a way to destroy our democracy than having government spend itself into oblivion. "

When did Obama become a conservative?

Jane Doe 1
60
Points
Jane Doe 1 11/26/12 - 01:33 pm
2
6
"When did Obama become a
Unpublished

"When did Obama become a conservative?"

Obama is a moderate democrat at the very most. He is not far left AT ALL. The President s a left-leaning reformer who is also a CORPORATIST. Notice that I said left-leaning rather than leftist, liberal, or progressive. For he has been anything but a flaming, far-left liberal or progressive, and has actually been much more of a mainstream capitalist than anything else. In fact, when he took office, with the Dow plunging, the rate of job losses exceeding 700,000 PER MONTH, and the economy in free fall and contracting, he managed to actually SAVE capitalism in this country! He did so by giving massive government-funded financial aid packages to the nation’s biggest banks on Wall Street, as well as to the ailing American automobile industry. His stimulus package contained massive tax cuts for corporations but much less for small, mom and pop businesses. You’ll note that only the biggest Wall Street banks got stimulus funds: nothing was made available to much smaller banks. These were hardly the actions of some wild-eyed, radical-left extremist! After all, it was not his fault that nearly all of these big Wall Street banks chose to pocket this money and sit on it, or waste it on huge executive bonuses, rather than make it available to smaller banks who would have gotten it into the hands of small businesses and individuals much sooner! As a result, unemployment has remained higher than it should be, but has nonetheless slowly come down in spite of ever-rising, much higher energy costs. American auto manufacturers have completely recovered, and are making profits and issuing profitable stocks and dividends to investors once more. There have been changes along the way, to be sure. Much were needed and some were painful. But the very thought of Obama having saved the capitalist system while somehow mysteriously converting it to a socialist one is utterly preposterous!

Jane Doe 1
60
Points
Jane Doe 1 11/26/12 - 01:37 pm
2
6
People like Angela prove one
Unpublished

People like Angela prove one thing to me...

Never underestimate the power of loathing for the poor. Which, I think, stems from fear; people are terrified of not being in control of their lives, of having to admit that sometimes bad things happen to good people who "do everything right" and yet still may fall into poverty because of a medical emergency that bankrupts them, the company where they work folding out from under them, some CEO shipping their job overseas (Sensata, anyone?), or something like the 2008 economic crash obliterating their life's savings. It's much more comforting, even if it's wrong, to look at poor people as "lazy" or the victims ONLY of their own poor decisions. "I'm not lazy," we tell ourselves. "I've made good decisions. I'll reap the benefits, because I made good choices and worked hard." Tain't necessarily so, folks. This is part of why we have a safety net. And even for those whose poverty DOES stem from their own screw-ups, what kind of a country is it that will let these people starve in the streets? Look at our history before the 1930s. It's ugly for the poor. Very ugly. Truth is, most people would rather be responsible and have the dignity of knowing they're not freeloaders. The proportion of genuine moochers among us is relatively low. As someone a bit more financially fortunate than that, I'm happy to pay a little freight toward carrying them, for the sake of helping those who need it and AREN'T moochers.

It's true that sometimes misfortunes strike that are not our fault, and sometimes the system is rigged. Not to acknowledge this risks falling into the trap of blaming those who suffer for their suffering, and erroneously assuming that those who succeed or fail must have somehow deserved their fate (good or bad). Which is waaaaay too simple a view of how our complex universe works.

I see a balance to be struck by both sides of the political spectrum. Convince yourself too thoroughly that the system is rigged, and you risk becoming a loser who can't take responsibility for anything; convince yourself too thoroughly that you are mostly (or completely) responsible for your lot in life, and you never know when to cut yourself--or others in difficult straits--some slack when necessary. The tricky bit--or the adventure of life, if you will--is finding and keeping that balance. To paraphrase Tip O'Neill, "Life ain't beanbag.

justthefacts
25501
Points
justthefacts 11/26/12 - 02:18 pm
7
1
Loathing the poor

Shame on Angela. Not sure where Jane came up with that based on Angela's posting. I guess I missed it. Or wasn't predisposed to the idea.

Humble Angela
41338
Points
Humble Angela 11/26/12 - 02:58 pm
6
2
Jane doe...please show where
Unpublished

Jane doe...please show where I stated any loathing for the poor......or are you just making up things I said?

Conservative Man
5578
Points
Conservative Man 11/26/12 - 03:33 pm
6
2
The principle of the thing is....

...I don't care if I have $50 bucks or $50 million when I die...it belongs to ME and I should be able to do what I want to with it...Give it to my family write a check to the government of flush it down the toilet ...It SHOULD NOT be the role of government OR a beauracracy to dictate to ME what I do with MY money upon my death...
Sadly far too many people have been brainwashed into thinking that it's perfectly okay to take something that does not belong to them and do with it what they will......

One question for you "proggies"..

What part of... "it doesn't belong to you "... do you NOT understand?

Conservative Man
5578
Points
Conservative Man 11/26/12 - 03:42 pm
5
2
As far as "perceived" conservative loathing for the poor...

....I'm sure whatever disdain we may have for the slothful, it's nowhere NEAR the absolute and incendiary, burning hatred that you "proggies " have for the wealthy...after all, in YOUR minds they didn't earn it right? They obviously "stole it from the workers and the poor",so your confiscatory death taxes are just "leveling the playing field" right....?
Envy is such and ugly, ugly emotion.... and the left's manifestation of this envy is even uglier....

wayne2410
1239
Points
wayne2410 11/26/12 - 04:03 pm
0
0
Wow Jane, do you really feel
Unpublished

Wow Jane, do you really feel you have the right to dictate who is deserving of inheritance and who is allowed to leave what to who? Is there anything liberals don't feel like they should be able to take from people rather than earning it? Unbelievable!

burninater
9949
Points
burninater 11/26/12 - 04:19 pm
2
3
Funny that some revere those

Funny that some revere those woeful ugly envious Marxist Founding Fathers.

"With Thomas Jefferson taking the lead in the Virginia legislature in 1777, every Revolutionary state government abolished the laws of primogeniture and entail that had served to perpetuate the concentration of inherited property. Jefferson cited Adam Smith, the hero of free market capitalists everywhere, as the source of his conviction that (as Smith wrote, and Jefferson closely echoed in his own words), "A power to dispose of estates for ever is manifestly absurd. The earth and the fulness of it belongs to every generation, and the preceding one can have no right to bind it up from posterity. Such extension of property is quite unnatural." Smith said: "There is no point more difficult to account for than the right we conceive men to have to dispose of their goods after death."

"The states left no doubt that in taking this step they were giving expression to a basic and widely shared philosophical belief that equality of citizenship was impossible in a nation where inequality of wealth remained the rule. North Carolina's 1784 statute explained that by keeping large estates together for succeeding generations, the old system had served "only to raise the wealth and importance of particular families and individuals, giving them an unequal and undue influence in a republic" and promoting "contention and injustice." Abolishing aristocratic forms of inheritance would by contrast "tend to promote that equality of property which is of the spirit and principle of a genuine republic.""

http://www.economist.com/blogs/lexington/2010/10/estate_tax_and_founding...

"All Property, indeed, except the Savage’s temporary Cabin, his Bow, his Matchcoat, and other little Acquisitions, absolutely necessary for his Subsistence, seems to me to be the Creature of public Convention. Hence the Public has the Right of Regulating Descents, and all other Conveyances of Property, and even of limiting the Quantity and the Uses of it."
--Benjamin Franklin

"legislators cannot invent too many devices for subdividing property, only taking care to let their subdivisions go hand in hand with the natural affections of the human mind. The descent of property of every kind therefore to all the children, or to all the brothers and sisters, or other relations in equal degree is a politic measure, and a practicable one. Another means of silently lessening the inequality of property is to exempt all from taxation below a certain point, and to tax the higher portions of property in geometrical progression as they rise."
-- Thomas Jefferson; Letter to James Madison, (Oct. 28, 1785)

"Admitting that any annual sum, say, for instance, one thousand pounds, is necessary or sufficient for the support of a family, consequently the second thousand is of the nature of a luxury, the third still more so, and by proceeding on, we shall at last arrive at a sum that may not improperly be called a prohibitable luxury."
-- Thomas Paine, 'Rights of Man, Part the Second'

"The great object should be to combat the evil: 1. By establishing a political equality among all; 2. By witholding unnecessary opportunities from a few to increase the inequality of property by an immoderate, and especially an unmerited, accumulation of riches; 3. By the silent operation of laws which, without violating the rights of property, reduce extreme wealth towards a state of mediocrity and raise extreme indigence towards a state of comfort; 4. By abstaining from measures which operate differently on different interests, and particularly such as favor one interest at the expense of another; 5. By making one party a check on the other so far as the existence of parties cannot be prevented nor their views accommodated. If this is not the language of reason, it is that of republicanism."
-- James Madison; from 'Parties' (1792)

burninater
9949
Points
burninater 11/26/12 - 04:45 pm
2
5
The old thumbs down to the

The old thumbs down to the warnings about entrenched, inherited wealth made by the very people that put life and limb on the line to establish a freer society. Whatever makes you feel better about yourself, I suppose.

Conservative Man
5578
Points
Conservative Man 11/26/12 - 05:15 pm
4
2
Still....

....it should NOT give the state the right to stick their hands in MY pocket YET AGAIN after I'm gone.....
..I for one, resent being taxed when I earn it, taxed when I spend it and then yet again taxed when I leave it....I mean really....when is enough ENOUGH!!....
I'm TOLD, (not even asked) that I should hand over willingly what I worked for, and if I don't I'm somehow greedy, but those who receive what I worked for without so much as an acknowledgement that it was confiscated are NOT?.....
Sorry, but yes....it DOES make me feel better about myself to care about the legacy I leave my heirs rather than the EBT cards left to the moochers, leeches and parasites that will slowly kill the "host" that is productive America....

InChristLove
22485
Points
InChristLove 11/26/12 - 05:47 pm
3
1
"If something that destroys

"If something that destroys family farms has existed for generations, how in the name of all that is holy can we still have a 96% family farm ownership rate in this country?"

Maybe I'm not following what logic has gotten burninater befumbled but if you have 5000 farms, 96% of them family owned would be 4800. If the tax destroys a majority of these farms and you now only have 2000 farms, 1920 which are family owned....you still have 96% of them family owned but the fact that the tax has destroyed most of them would still remain a truthful fact. So wouldn't this mean what dichotomy stated is true.

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