Estate Tax Expiration Kerfuffle
All this, "Oh my God, the Estate Tax is going to expire next year" chicken littles need to remember that under current law it comes right back in the following year and the rates and exemption in existence the year before the current law was enacted.
Except for the lucky few recipients who (knock off) or are fortunate enough to have dear old dad or mom kick off in 2010, in 2011 the reversion means we go back to square one with higher rates (45% back to 55%) and lowered exemptions ($5 million back to $1 million).
It would seem to me that the onus is on the Republicans and if they want to filibuster a permanent fix, they can tell their rich friends to make sure they all die next year.
Except for the lucky few recipients who (knock off) or are fortunate enough to have dear old dad or mom kick off in 2010, in 2011 the reversion means we go back to square one with higher rates (45% back to 55%) and lowered exemptions ($5 million back to $1 million).
It would seem to me that the onus is on the Republicans and if they want to filibuster a permanent fix, they can tell their rich friends to make sure they all die next year.
Advertisement
Onus is on the Republicans? There's lots of rich Democrats out there (including PE Obama) who will be worth more than $1mm and would also like to see a "fix".
I certainly won't be subject to the estate tax but I am completely sympathetic to any small business owner who builds a business over their lifetime only to have to hand over a bunch of it to the government when they die. We need a fix.
January 12, 2009 7:01 PM | Reply | Permalink
This is, I think, the first time I've had much sympathy for one of your comments MCB. I have a friend in this position, who has been running her father's foundry for the past 15 years. She has worked to keep it running and skates by with about 30 employees. Their machinery isn't worth much on the open market. Their physical plant is probably worth a fair amount. If she faces very high inheritance taxes, she'll more than likely have to liquidate the business and 30 skilled labor jobs. She'll be Ok either way, but the loss of those good paying jobs to the semi-rural area would be a shame.
January 12, 2009 8:28 PM | Reply | Permalink
Oh my god, what am I going to do. My kids were all set to get the four mill tax free.
Well, such is life as the French would say, of course they would only say this in French, since they are in France, or of course they could also be in Quebec.........
January 12, 2009 8:10 PM | Reply | Permalink
No less than Warren Buffet believes it is not good to leave much to your kids. He's giving it to Bill Gates and his wife to dispense through their foundation.
Nuff said!
January 12, 2009 8:16 PM | Reply | Permalink
Leaving all your money to a charitable foundation can cause as many problems as it solves for society, by removing, (in the case of Buffet and Gates), large sums of money from the economy to a tax exempt institution. Jeffrey Toobin had an interesting read in the New Yorker not long ago chronicling some of the issues regarding Leona Helmsley leaving something like $8 Billion to a foundation to be set up in her name for dogs.
January 12, 2009 9:51 PM | Reply | Permalink
Exactly - and if I wanted to live like the French then I will move to France.
Warren Buffet is not a good example. He's worth so much money that he's out of touch with how the estate tax affects people with a WEE less money than he has.
January 12, 2009 10:39 PM | Reply | Permalink
The point I was making was a political point. Democrats love to get the knickers in a twist about everything.
I am personally all in favor of a permanent fix to the Unified Estate and Gift Tax with at least a $5 million per person exemption and a 45% tax rate above that.
January 13, 2009 10:22 AM | Reply | Permalink
SOUNDS GOOD TO ME
January 13, 2009 1:01 PM | Reply | Permalink
Hmmmm....How many folks are going to whack their parents before the tax gets fixed?
January 13, 2009 4:47 PM | Reply | Permalink