Comments on: Hey Congress, Why Don’t You…? Estate Tax and Dividends

By: My Journey

My Journey — Fri, 04 Sep 2009 17:01:54 +0000

JBruce,

I am going to have disagree with you. I don’t believe this has to do with “W” as you so nicely put it. The Estate Tax was an inssue going back decades.
While I can agree with you Health Care reform would benefit the country, GOVERNMENT CONTROLLED ANYTHING is not the answer.

By: JBruce

JBruce — Fri, 04 Sep 2009 16:04:15 +0000

Back when W’s tax “cuts” were being worked out the Republicans managed to rile up vast numbers of people about “death taxes” even though they wouldn’t affect most of them. Notice, they made little mention of gift taxes, which gives you an idea of what their underlying agenda really was: keep the plutocracy intact.
Just like they’re doing today, by making up non-issues and fabrications in support of our existing godawful (and highly profitable) health care system. It always has disgusted me that the legislation that created the loopy Medicare drug benefit specifically prohibits Medicare from negotiating lower drug prices with the drug companies (which your insurance company can, and does, do). How does THAT benefit Medicare recipients, or the deficit?

By: My Journey

My Journey — Fri, 04 Sep 2009 13:15:21 +0000

Regardless of my feelings on the Estate Tax, which go back and forth since it employs me but I hate taxes, I find it interesting that this is such a hot button with everyone here (I have never seen 10 comments on Tax Girl’s site, besides the Gay Marriage Issue) as well as the general public; only 2 to 4% of the entire country’s estates are subject to the federal tax. While there are a lot more hit by the decoupled states especially in NY, where I am, this post and the following comments seem to be focused on the Federal Estate Tax.

Gift tax is another hot button, yet there aren’t many people, in terms of % of population, gifting more than $13,000/year where the money isn’t part of tution or medical payments (they are excluded from the Gift tax). And then even if they do gift more than that they have up to another $1,000,000 lifetime to gift.

By: JBruce

JBruce — Fri, 04 Sep 2009 12:15:24 +0000

David Shulman said it better than I did. Also, he mentioned something that I forgot: estates don’t pay capital gain taxes. In his example of the long-time owner of Microsoft shares, if he sold the shares he’d have to pay tax on the gain. If died with them, his estate would not pay any tax on the gain (or gains from any other assets in the estate).
We can discuss the efficacy of the tax on capital gains elsewhere.

By: 5 Things You Should Read | The Personal Finance Playbook

5 Things You Should Read | The Personal Finance Playbook — Fri, 04 Sep 2009 10:04:35 +0000

[...] Hey Congress Why Don’t You @ Taxgirl – This is a series by the readers of suggestions to Congress about ways to change the tax [...]

By: David Shulman

David Shulman — Fri, 04 Sep 2009 02:36:38 +0000

I disagree that the estate tax is a form of “double taxation.” For example. If in 1986 you would have taken $10,000 in post tax funds and bought Microsoft, it would be worth $2.9 million today. That appreciation has never been taxed.

Why is there an estate tax?

(1) The government needs money. Instead of talking about eliminating the estate tax, talk about drastically cutting government spending.

(2) There is a notion that we are not a country with a permanant aristocracy in which wealth is passed on from generation to generation forever. Warren Buffet has said, “I want to leave enough money to my children so that they can do anything, but not so much that they can do nothing.” See also Hilton, Paris.

By: Scott Lovingood

Scott Lovingood — Wed, 02 Sep 2009 04:29:17 +0000

JBruce – Gift taxes are another form of double taxation. You have already paid taxes on the money you earned. Why do you have to pay taxes when you give it to someone else? I think the gift tax should be eliminated as well.

If Congress wants to see the economy grow by leaps and bounds, it needs to take the breaks off of it with the tax code. Not by establishing tons of credits and exemptions and minutia of rules, but by an overall lowering of the tax liability.

Our country’s spending has grown to outpace any amount of taxation. The only way we can get it under control is to start cutting it deeply. Taxes and spending. Free markets have always outperformed government controlled ones.

Working in the tax industry I see the ones who are impacted by these rules. The middle sized guy is the one who bears the brunt. The rich have staff to help them find ways around them through legal channels. The middle sized guy gets the hammer every time because he doesn’t.

By: JBruce

JBruce — Wed, 02 Sep 2009 00:13:58 +0000

Okay, nobody will like me for this, but I like estate taxes. Death and taxes, together again! Actually, one aspect of the estate tax is that it makes it harder to establish multigenerational dynasties. On the other hand, why eliminate the estate tax if you keep the gift tax? Give it to someone when you’re alive and pay big taxes — will it to them and no tax. Makes no sense to me.

By: My Journey

My Journey — Tue, 01 Sep 2009 17:10:22 +0000

Oxnate,

AMAZING! It would also cut down on the use of superfluous wordage!

By: Oxnate

Oxnate — Tue, 01 Sep 2009 17:03:17 +0000

We live in a country of codified laws, where “ignorance of the law is not an excuse.” How many years would it take to read all the tax laws and codes? How can we say that ignorance is no excuse when it’s physically impossible to read the laws?

I would be in favor of limiting ALL laws to the number of pages that the average person could read in a year.

(200 Word per minute X 60 Min per hour X 8 hours per day X 5 days per week X 50 weeks = 24,000,000 words.) 24 Million words should be more than enough to codify all the laws that are important to us as a people. Everything else will have to be left up to the states.

The best part about this plan is that once they reach the limit they’ll have to repeal old laws in order to pass new ones.