The Estate / Death Tax

You have to admit that you're the rare taxpayer. Most people pay lip service to getting rid of loopholes but end their support when the loopholes benefit them.

I would prefer a far less complicated tax. Something like the flat tax proposal (where you could do your taxes on a postcard), but I don't have a problem keeping the progressive rates.

 

Except that the child credit is only like $500.

Not a very big thing to give up.....IMHO.

I would give it up too, and I qualify twice.

DD

 

Still, it is the ONLY deduction that I have and I would give it up in a second if it meant simpifying the tax code or scrapping it altogether in favor of a consumption tax.

 

You do receive a penalty. Though you're dead, your legal entity continues on in your estate and it is punished with the tax.

Your estate is you. If you aren't paying the tax and your heirs aren't paying the tax, then nobody pays the tax. Obviously that's not the case. You pay the tax.

Pretending that your estate isn't you is playing with reality.

 

The market solves all problems. If a company in this day and age is killing people, the media will spotlight and the resulting outcry will have more effect than a bureaucrat levying a silly fine. As for drugs, the FDA has made it HARDER for lifesaving drugs to be developed. Why not have a drug equivalent of the Underwriter's Laboratory? It would do more good and get it done more quickly......because.....there was profit motive in doing so. The only thing I see as important govt. functions are national defense, law enforcement and environmental protections. Anything else needs to be in the private sector.

 

Payroll taxes do not affect everyone equally, because there is a cap beyond which you don not pay payroll taxes. Just as there is a floor beneath which you do not pay income tax. Since libs seem to think cutting everyone's income taxes (or at least everyone who pays income taxes) = screwing the poor and middle class, then cutting payroll taxes = screwing the rich and middle class.

 

We are talking about the inheritance tax in this thread, which ONLY affects the VERY wealthy. This is not the right tax to cut.

 

Andy;

You like consumption taxes, yet they're the most regressive of all.

 

When it comes down to it, it not really the Rich can use the loopholes and the poor can not. It's rather differs between the informed people and the uninformed people.

whether you make 50k or 5mil a year, there are different things you can do to minimize your tax obligation. Some as simple as max out on IRA/401k, itemize your deduction. Yet many ppl choose not to do it, or don't know how to do it.

The way estate tax is setup, it targets only the people who most likely worked hard all their life and was able to accumulate significant amount of wealth. If you are going to tax estate, why not tax everyone, maybe a flat tax is a good idea.

andymoon, there will always be someone richer or poorer than you. Should someone who makes $5 an hour complain "those ppl makes 40k a year can use that IRA/loophole to reduce their taxes, that's unfair".

So instead of complianing all the time, maybe we should all work harder and amass more wealth; this is a capitalist country you know. Remember 'Very Wealthy' is a relative word, for most of the world, andymoon is 'Very Wealth'

 

I haven't read all 5 pages of the thread (sorry! maybe later), but I figured I'd give an opinion.

If I had an estate large enough to be affected by the estate tax, and it was going to impact what I could leave to my children, then I would be happy with raising the level where it kicks in and delighted if it didn't exist. I'm that honest, I guess. It's like the death penalty... I'm against it, but if a close family member or friend was wacked by a psycho, I'd be wanting the guilty person dead. Sorry.

But I'm against doing away with the tax. When we are running record deficits, this isn't the time to be cutting revenue. Maybe if we get surpluses again. (I'm not holding my breath)

I think many view the estate tax the way some Southerners viewed slavery... "golly, I don't have any slaves, probably will never be able to afford them, but I'll be damned if I'll let some Yankee tell me I can't have 'em!" Many of us fantasize about being rich someday. Perhaps it colors our thinking a little bit.

 

Not if you structure it correctly.

First off, I would only tax new goods and services. If one wanted to save on the tax bill, they could Ebay, pawn shop, or garage sale it. In addition, necessities like food, medicine, etc. would be tax exempt. You could also do a tax exemption for, say the first $5000 for everyone.

When we run a surplus (after the debt is paid), we could give it back to the taxpayer in the form of tax holidays at back to school time like we do here in Texas.

 

There is no inheritance tax, so it'll be hard to cut. I can inherit all sorts of stuff and never pay a tax, no matter how large my inheritance.

We're talking about the estate tax in this thread.

Personally, I hope my kids have managed to make their own way in the world by the time I die, so even if I were subject to an estate tax, it won't make that much difference to them.

Much of the benefit that the children of the wealthy receive comes while the parents are still alive, much of the time.

 

Andy:

You're creating all sorts of loopholes

Point is, a high income earner may need only a small percentage of her pay to sustain her lifestyle. The rest can be invested (earning tax free income)

A less affluent person would require virtually all her income to pay for goods and services.

Also, the money she spends outside the USA is not taxed...

 

mrpaige is correct, there is no inheritance tax.

estate tax and gift tax both tax the giver. In fact they are related to each other, any gift amount over the 10k limit eats into your estate exemption limit.

 

bnb, if you know any investments that's tax free other than the normal exemptions, please let us know.

Also someone's lifestyle is again relative, (i.e. someone makes $5 a hour vs someone makes 50k a year vs someone makes 5 mil a year)

 

Far fewer than we have now.

GREAT! That is the kind of investment that WILL drive the economy. And when that person is ready to buy their helicopter, Ferrari, or other consumables, they will pay their fair share of taxes. In addition, corporations will pay their fair share when they buy consumables.

This is different from the status quo in what way? They already pay virtually all of their income for goods and services.

The less affluent could also pick and choose how they spend their money by shopping for second hand goods or nontaxable products.

It is too. It is taxed by the country where they make the purchase (most countries have a consumption tax already, it is called a Value Added Tax or VAT in Europe) AND if they import it, it could be subject to further duties as they are today.

The consumption tax could also drive innovations in recycling as used goods would be exempt and refurbished goods would draw a fraction of the full tax for a new product.

There are ways to create a functional, transparent, and fair system of taxation, but we will have to get it past the rich, greedy people and corporations who want to keep the status quo so that they can continue to milk it for all it is worth.

 

The tax that should have no exemptions or loopholes is the income tax.