Here's A Modest 'Death Tax' Proposal for Whoopi Goldberg

Whoopi Goldberg thinks she sees something called a 'death tax,' the same way she saw phantoms in Ghost. Ghosts may or may not be real, but there is no such thing as a "death tax." Like many wealthy people, Whoopi uses this artificial phrase to complain about her inability to give as many tax-free millions to her children as she would like.

Whoopi's kids will pay tax on their unearned income. That's an inheritance tax, not a death tax. And even though they've done nothing to deserve it (except for having a rich parent), they'll receive much more favorable tax treatment that regular people get when they work hard for their money. They'll be able to enjoy their first $2 million of inheritance absolutely tax-free.(1)

Why, you may ask, do wealthy children get a tax break that others don't? Because our country's lawmakers have traditionally favored the idle rich over working people. Whoopi, I think you understand that. And while everybody understands the desire to leave our wealth to the children we love, hardworking Americans aren't really happy about the 'tax-free' part.

This "death tax" phrase was designed and marketed by conservatives to confuse people into supporting the idea that rich kids shouldn't pay any tax at all on their unearned multi-million dollar income. And it won't go away. I saw a headline the other day that read "Dexter: Let's drop death tax." I thought it was referring to the serial killer on TV named Dexter. If he paid taxes for every victim he murders, that would be a "death tax."

(Actually, "Dexter" is a Canadian politician who's using the phrase for its intended purpose, which is to confuse voters.)

"If I have to give something to my kid I (when) already paid the tax," says, Whoopi, "why do I have to pay it again because I died?" Er, Whoopi ... you don't. They do. Just the same way your gardener and maids have to pay taxes on the money you give them, even though you paid taxes when you earned it. (Except for the fact that they don't get the first two million tax-free.)

It would only be a "death tax" if you had to pay it again personally.

Hey, look. We like Whoopi Goldberg. She has a big heart, and she does great work. We don't want to pick a fight with her. So here's an offer to keep things friendly: Whoopi, we'll tax your kids, but we won't tax "you" twice. So if you really think you've been forced to pay a "death tax" after you die, here's our proposal:

Just come back and ask for a refund. We'll see to it that you get one.

___________

(1) See this tax guide for information on the Federal estate tax, which is commonly referred to as the "death tax." Here's an excerpt: "... Congress has approved a schedule that increases the amount an individual can leave to heirs tax-free to $2 million in 2006-2008 and to $3.5 million in 2009. In 2010, it will supposedly be repealed altogether."

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Comments

[midtown]

That's a bullshit argument. The gardeners and maids have a choice of receiving money: they're not forced to work for Whoopi at a price SHE SETS. They could just as easily work for someone not as generous as Whoopi and thereby keep their total earnings for the year under a certain income bracket.

Heirs have no choice in what they receive. They get their parents (if that's who's doing the inheriting) debts as well as their assets. Sometime debts exceed the assets and a child has no way of knowing that.

Other times, the value of the little $70,000 house bought in the Hollywood Hills in the early 70s is valued at $4 million in 2007, and the heirs have to pay the tax on that if they want to live in Mom and Dad's house, or they are forced to sell it. Couple that with a second mortgage that the kids didn't know about because Dad had to pay for Mom's cancer treatment 24-hour nurse, and that "lucky heir" you refer to is deep in debt as a result of the death.

This story plays out across the heartland with small family-owned farms. Someone sticks a value of $4-6 million on a farm that was bought for $100,000 four decades ago, and the family is instantly broke upon the demise of the original owner .

Whoopi is right and you are wrong.

[hopeless277]

If this tax applies to you, Wilson33, then you should be sailing on your schooner, not replying to blogs.

[NABNYC]

Yes, another case in which the public has been grossly misled by the Republicans. And the Democrats have failed to do one thing to try to educate the public as to the truth. That is because both Republicans and Democrats receive huge bribes from rich people to slash their taxes.

If a parent wants to give their child $50,000, the first $10,000 will be tax free to the child under a gift exemption. The next $40,000 will be taxed to the child as "gain," at ordinary income rates. Around 30% assuming the child is otherwise employed.

If a parent dies and leaves the same $50,000 to the child, the child receives that money tax-free. The child pays no taxes on it.

The estate tax laws, in other words, provide a special exemption and protection -- an exclusion from taxes instead of the opposite.

It is only when a parent leaves a large estate, over $2.0 million in current dollars, that the child will be pay taxes -- but then only on the amount over $2.0 million.

Another example of tax laws favoring the rich is capital gains. One person works for a living and earns $100,000/year, and pays 30% taxes. Another person does not work, but lives off of their stock portfolio, but earns $100,000/year, and only pays 18% taxes. And the rich people want to go further and exempt capital gains from any taxes whatsoever.

Too bad the Democrats are so corrupt that they refuse to speak out and educate the public as to the truth of this massive tax fraud being conducted by the wealthy in this country.

[LittleLiberal]

When my mother died, I "inherited" some money and was heavily taxed on it, yet it was WAY less than 2 million dollars.

[Wilson33]

We are taxed enough, this is simple robbery by our government.