Tax the heirs of the rich (at least of few of them)

[groundloop]

An interesting editorial with some very good information concerning the estate tax (from the Christian Science Monitor).

http://www.csmonitor.com/2009/0423/p13s01-wmgn.html

The famous American philanthropist Andrew Carnegie believed inherited wealth spoiled the heirs. "I should as soon leave to my son a curse as the almighty dollar," he said more than a century ago. ....

Only estates worth more than $3.5 million would be taxed at the rate of 45 percent and only on sums above $3.5 million. Widows and widowers would continue to be exempt from paying the tax on the estates of their spouses. ...

...And heirs of only 6,200 multimillionaires would have to pay any estate tax at all. Because of the basic exemption, charitable giving, and other exemptions, the effective average tax rate on an estate would be much lower than the marginal 45 percent. Only about 550 small-business owners or farmers faced the estate-tax burden last year.

[havocmom]

1. More good stuff to bookmark and use against RW astro turf LTTE & emails

thanks for posting. Estate tax is a big lie where I live. The wingers all think it applies to them. Poor fools.

[grasswire]

2. maybe critics would rather just means test social security and medicare

That's a simple way to turn things around. Just change a few policies that currently shelter the rich and soak the taxpayers.

1. Means test social security. At age 62, those with enough revenue/assets to retire comfortably could be repaid their social security contributions plus interest, in a lump sum.

2. Means test Medicare. A person who can easily afford a private insurance policy should pay for it, and that private insurer should be the first payer and Medicare the supplemental. Why should taxpayers be footing the bill for medical care for those who can easily afford private insurance?

3. Stop this nonsense where a family's assets are protected while a "spend-down" makes Grandpa poor enough to qualify for Medicaid. Why should taxpayers foot the bill for Grandpa's elder care while assets are transferred to family members to protect the estate?

[Romulox]

5. Agreed. Un-means tested welfare programs are the ultimate in regressive taxation.

[bluestateguy]

3. Having no estate tax does NOT promote hard work and responsibility

I'm all for the right of a person of modest means to pass on their estate to their heirs without government taxation, but when the super rich are able to pass on their estates, unencumbered by taxes, it gets to a point where you are not promoting hard work and personal responsibility any longer.

TR, a Republican, realized 100 years ago that it was actually dangerous for democracy to have a permanent overclass of a few rich families passing on their wealth in perpetuity. That's why he advocated the estate tax.

[KittyWampus]

4. My family's family business is on property that is worth more than the base of 3.5 million

because real estate values have skyrocketed. The ground under our feet has become worth a fortune.

We don't have that much money in liquid, spendable form. In fact, we just get by. Any time there's a little profit, it goes into capital improvements like keeping the roof from falling off or replacing 100 year old metal pipes.

I once made the grave error of starting a thread about this. It seems there's a large number of DU'ers who just don't support small, local family businesses as being worthwhile. Even if we are talking about a rare third generation business.

And the pockets of real estate that have increased exponentially in value is still increasing with areas devoted to suburbia and farmland overlapping more and more.

Larger corporate farms want more land. Especially with growing demand for ethanol.

And people in cities and suburbs want a home surrounded by farmland/vineyards/horse farms.

[PassingFair]

6. That's what trusts are for. n/t

[KittyWampus]

7. A family owning a small business shouldn't have to give property over to a trust

because rich people want a second home and inflate value of real estate in certain areas.

And that is as a matter of principle.

[PassingFair]

9. "Businesses" do ALL kinds of things to stay in business.

It's either a business or your inheritance.

Not both.

Take your cut and run, or act like a business.

Sorry, you are too close to
the money to be objective
about what is good for society
as a whole.


:hug:

[Romulox]

11. You don't understand the basics of a trust.

A trust is property held by a trustee for the benefit of another. The trust doesn't own the property--the beneficiaries (and/or the settlor) own the property.

[Dollface]

10. Sounds like you need a good estate plan. There are ways to transfer the property via gift or sale

to the heirs before death and remove it from the estate as well as ways to lock in the value. There are also provisions that permit special use valuation of property as opposed to having it valued at its highest and best use as well as provisions that allow the estate tax on assets used in a family business to be paid over 15 years at a low interest rate. Talk with your accountant/attorney and get a referral to an experienced estate attorney. A business transition plan is as important as your will. The up front cost may seem high (these guys aren't cheap) but the savings from just retitling assets can be tremendous. I saw a guy save over $360,000 in tax simply by moving property into joint ownership with his wife.

[leftofthedial]

8. tax everything above the median net worth at 100%