Obama Plans To Keep Estate Tax

President-elect Barack Obama and congressional leaders plan to move soon to block the estate tax from disappearing in 2010, suggesting the levy might outlive the "Death Tax Repeal" movement that has tried mightily to kill it.

The Democratic stance on the estate tax contrasts with Mr. Obama's reluctance to press forward with his campaign pledge to raise income-tax rates on top earners, which he worries could have an adverse economic impact during a recession.

Read the whole story here.

Comments

[belicoso]

The estate tax is an absolute joke. There is no reason in the world why anyone's assets should be taxed in life and after death. The government already got their due while the individual was alive, taking a second taste is just ridiculous. It's not enough that you might have to deal with an overly greedy relative who might take you to court in some long and drawn out legal battle over your share of inheritance (a la Anna Nicole Smith), but the government has to skim off the top as well? How is anyone supposed to preserve assets for those noted in their will with all the possible ways it can be taken from their survivors?

[JHCowboy]

The estate tax plan needs to be completely renovated and changed. There are thousands of farming and ranching families (including my own family in Wyoming) who own thousands of acres of ranch land and when their parents die the IRS tells these dirt rich, dollar poor folks that they owe millions of dollars because the property values have sky rocketed (through no choice of their own). That's just plain WRONG to force ranching and farming children who wish to continue in the legacy of their parents in ranching that they have to pay a huge tax that is unbearable. It's just wrong! I don't believe in it for one minute.

To be completely honest I wouldn't be sad if the death tax died completely.

[indypete]

I get such a kick out of people who own thousands of acres whining about how poor they are!

[adamsmith3]

It's not like the land just appeared in their ownership one day. They worked hard to own that land and they want to pass it down the family line without the government taking money off of the top every time. I get so tired of the stick-it-to the well-off mentality, especially those who only seem well-off on paper but aren't. Did you even comprehend the post above? Those thousands of acres have extremely burdensome property taxes to begin with. Why should the government be making it even harder on them?

[helonias]

But this tax will help these folks get into the kingdom of heaven

[helonias]

So Bill Gates pays how much % in Capital gain taxes

and how much do you pay % on your salary

[drock973]

This always gets brought up about Buffett and his secretary. Buffet pays 15% in taxes, his secretary pays more(I don't know the rate but probably about 27%). What always get left out thought is he paid 15% on $1 billion for a total tax liability of $150 million, more than his secretary will make in her lifetime.

[indypete]

In the immortal words of dick cheney.....

So?

[PATina]

YES !!!!! That will be one way to help w/ our economic recovery and it could also be used in the future to pay down the increasing debt.

[dagdavid]

Yes. Keep the estate tax.

[cyoohoos]

Come on, the article is from the Wall Street Journal. Wall Street! The same greedy, shady, fat cats who just robbed every American taxpayer to preserve their standard of living under the guise of 'capitalism'.

This is another Republican tactic to get the middle class to focus on a non-issue so they can continue to help us 'manage' our money. Who cares if multi-million dollar estates of dead people are taxed. I say anyone who directly benefited from the 700 billion dollar bailout should turn their ENTIRE estate over to the government, not just a percentage. It's our money anyway.

[chicago25624]

I love their explanation how it only effects 1%.

Here's a story to counter that.

After WWII my uncle bought a Victorian in San Francisco, a few years later bought the Victorians on each side of him. He died and passed it on to his daughter. The government got their tax. When she died she passed it on to her brother. The government got their tax. When he died, with no offspring, it went to his aunts and uncles, my mother included. 3 Victorians sold in San Francisco 5 years ago, the settlement was just paid, and our family's. all middle class lost more than 2/3 of the sale amount to taxes.

So please, save the BS it only effects the rich. They were taxed for 60 years on that property, taxed when it was passed on twice and taxed again when it was sold.

Ah liberalism 101

[adamsmith3]

Yes, they'll find any monetary transaction possible to suck money from. It's pathetic.

[schatsie]

PLEEAASSE... The only information we can get out of Wall Street now is WHAT? Do you believe these people really pay taxes?

That is why we have a tax established at the time of the estate, because finally the relatives want to know what is REALLLY THERE...and that is when the accounting will be most reliable....

[schatsie]

Think about Warren Buffet... the man pays taxes on his salary....... think about that again, the man has accumulated 50 billion dollars by avoiding income taxes.... on that 50 billion dollars over the last 50 years... His benefits include a corporate jet, a pilot and hundreds of thousands of dollars in fuel and insurance and maintenance... and he pays $500 for a ride from Omaha to Carmel to play golf....and writes off the meals and golf...

The only way people pay estate tax is if the accumulated wealth is over $1.5 mil per person...88% of us make less than $100 grand and use that for our reasonably priced housing and saving into the 401K that crashes regularly (Teck Wreck and Wall Street Bailout)....and necessities which include paying utility rates that include income taxes which are not paid....

[Andman0121]

...now THAT was a good response. GOD conservatives are dumb

[dagdavid]

It mostly benefits the rich. By the way, San Francisco has some of the most expensive real estate in the US. If you own three homes in San Francisco, then you might correctly be considered rich. This has nothing to do with liberalism.

[PATina]

Thank you.

[bygollymissmolly]

I highly doubt your story. There has never been a time where estate taxes are 2/3 of the sale of anything. If your family sold the properties, they were not paying estate taxes, they were paying capital gains on the value of the properties. If the family did actually pay estate taxes on the value of the properties, that was piss poor planning on the part of the father and the daughter. If they had transferred the property to the heirs before they died, the heirs would not have paid anything in estate taxes on the properties.

So, let's say that the properties were purchased for a total of $300,000 back when. They were worth $3,000,000 when they were sold. I'm sure that you think you should not have to pay any takes on the increase in the value of the properties, but that's not the way it works in this country. If you don't like it, you could move elsewhere.

[me again]

Taxes have been paid on estates monetary assets, this is just a form of a government double dip and is wrong.

[AtticusinPa]

The article is materially misleading. First, under the Bush bill, the tax disappears in 2010, but then returns in 2011 at 700,000 minimum with, I recall, the higher rates. It was a politically cowardly act. More importantly, the act really is not double taxation, for the original law permitted stepped up basis of inherited assets: the kids inherit the family assets, but pay no capital gains taxes at all on the sale. So what the estate tax takes, the income tax leaves. Hidden in the Bush bill was a repeal of the stepped up basis for inherited assets; and that repeal applies to us all, Joe da Plumber and Paris Hilton. The repeal of the basis hurts us all, there is no floor. And the paperwork will be a nightmare. Ask your Dad if he has kept records of the purchase of every share, all of the splits, mergers, consolidations and reissues. If he had the Bells and Baby Bells, it is very difficult to calculate the basis for estate purposes, considering that the person most likely to know is deceased. Congress should pick a rate and floor level the budget can live with, re-instate stepped up basis and leave the estate tax alone.

[BLinCincinnati]

The only thing the GOP has managed to do well, is convince a bunch of idiots to support getting rid of taxes that will never affect them. They've brainwashed all these people into thinking that they must support lower taxes on the super rich because they will some day be rich too. But they never will, and they continue to scream and yell about something that is against their own best interests, in the delusional thinking that they will be that 1 in a million person dumb person to make it rich and to actually benefit from their protests.

[amazedandoutraged]

I question that the ultra-rich worked any harder for their money than the average, hard-working person. There are only 24 hrs per day. More like luck, connections, some inspiration, greed, taking from others, not paying employees adequately, some cheating and lying, also hard work, maybe. Do we want the country to continue to be controlled by inherited wealth? By those who did nothing to earn it besides get born. George W inherited the presidency. What did that get us? These people are ultra-rich because of the opportunities our country afforded them. And how much is enough? They who earned it, won't be needing it in the hereafter. Those left behind with a mere $3 million would be better off developing some character and skills on their own--not being given the power to control our country and people with money daddy or mommy made.

[vippy]

Yes, indeed, every rich person had a dark secret!

[schatsie]

yes look at Bush, either Travelling to Vacation or on Vacation 30% of the time.... See Harpers...

I get 2 measly weeks for vacation, 4% of the time, and 2 weeks for holidays and sickness for another 4% and that is good in this country..Let me see 30% vs 8% and then I get lectured on how lucky I am and what i need to do to raise a child etc....AND TO PUT THE FROSTING ON THE CAKE, I am supposed to VOLUNTEER....

[bygollymissmolly]

The super rich don't earn their money through working. They earn their money by sitting on their backsides and living off their investments. Those profits from the investments are now taxed at roughly half what we pay when we gather our paychecks.

[hortonhearsawho2]

Who's, Mine...

[Riani]

It's all fine and well if what you are inheriting is cash. But if it is a business, or property, people often end up having to sell it to be able to pay the taxes on the inheritence. If my father spent his life building up a business that is now worth $10m, and he dies, and leaves it to me, where do I get the $4.5m from? Some people might have that kind of cash laying around, but in many cases it might be tied up in assets. I think there should be a distinction made between types of inheritence. If you inheriti a house, or a business, or a car, or jewelery, or shares,you don't pay tax, but if you sell it, you do.

[AxelDC]

The Estate Tax is the least economically-disruptive tax extant. All taxes distort the market economy by punishing behavior: income tax punishes labor, property taxes punish homeowners, sales taxes punish consumers, capital gains taxes punish investors, cigarette taxes punish smokers, and estate taxes punish death.

Of the above behaviors, which is the least likely to be altered by taxation?

On top of that, W has instituted a 100% tax on the elderly by changing Medicaid laws so that you cannot transfer your home to your heirs in order to get help with nursing home care. Medicare only covers 180 days/year, so that most people end up on Medicaid to cover the rest. However, you cannot receive Medicaid if you own your own home, so most people transfer it to their children. W changed it so that you have to have done that 5 years early, so now you have to deplete all your assets before government assistance kicks in. This means that the vast majority of us will die penniless with nothing to leave our heirs: a 100% inheritance tax!

[schatsie]

and that is because we as a society do not pay for UNIVERSAL HealthCare... There would be no discussion about this topic IF we had universal healthcare,,, get it?

[MacQ]

Axel:
Do you think your taxpayer dollars should fund the nursing home care of someone who has a home worth a half a million dollars (or any amount really)?
Or do you think taxpayer dollars should just kick in when the person's assets run out?

Think about it...